I'm just wild about retail stocks -- but I'm not wild about all retailers. When considering a stock to recommend for Stocks 2007, one of this year's "hot" IPOs, J. Crew (NYSE:JCG), didn't make my list.

J. Crew is definitely not a trendy new retailer. It's been around since 1983, when it started out as a catalog-only retailer, just the way Coldwater Creek (NASDAQ:CWTR) and Talbot's (NYSE:TLB) J. Jill did. Since then, it has built up a store base and a solid brand that just about everybody knows. And, of course, it has displayed some impressive financial results so far, repairing some of the issues that hindered it as a private entity.

However, I have numerous concerns that -- despite many investors' seemingly overwhelming confidence -- led me to take a pass on the stock.

The past may not be prologue, but it's good to know
It doesn't pay to have a short memory. J. Crew's IPO was long rumored -- and subsequently delayed. In August 2005, I looked at J. Crew's IPO filing with the SEC. Although the retailer had turned itself around a bit by then, I noticed that it hadn't had a profitable year since 2001 and that its $804 million in sales in 2005 still hadn't caught up with the $826 million in sales it had made in 2001. It had a hefty debt load, and its bricks-and-mortar expansion had stalled, with its store base at just less than 200 locations for three years.

Obviously, an IPO could help J. Crew remedy its issues, by reducing its debt burden, improving its balance sheet, and jump-starting store openings again. While I know that for investors, companies' historical performance isn't nearly as important as their growth potential going forward, my point is that J. Crew isn't bulletproof. It had a tough couple of years that may not have hit the radar, since the company wasn't publicly traded at the time (although it did file with the SEC because of its debt). Sure, every retailer has missteps -- they often represent opportunities for brave investors who can overlook current negative psychology -- but J. Crew's lasted for several years running.

If that reminds you of another retailer, don't forget that J. Crew has that whole Millard (Mickey) Drexler element. People have mixed feelings about Drexler, who's known for both his savvy fashion sense and his leadership of Gap (NYSE:GPS) as that company greatly overexpanded and took on an onerous amount of debt. Although J. Crew's debt predated Drexler's tenure, the memory of Gap's early rise -- and subsequent fall -- may always have some connection to his name.

Then again, anybody who has followed Gap over the past couple of years knows that Drexler's replacement, Paul Pressler, hasn't been having an easy time of it, either; while Gap's balance sheet got fixed (that's partly why it's been recommended by both Motley Fool Stock Advisor and Motley Fool Inside Value) the retailer's fashion sense has yet to return to its previous glory.

Fashion or folly?
Fast-forward to today. J. Crew's shares have rapidly risen 50% in just three months, and that in itself is enough to give me pause. (I wasn't entirely optimistic right after the IPO, either.) Some Fools have found themselves intrigued by this retailer's shares since it went public, but others have shared my concerns. I couldn't help thinking that recent defections of a few J. Crew directors (including a co-founder) looked like opportunistic cash-outs following the IPO.

Last but not least, exactly what is J. Crew's competitive advantage? Despite its strong brand and name recognition, I've never perceived a clear difference between its preppy (albeit pricey) threads and the merchandise at other hot retailers such as Abercrombie & Fitch (NYSE:ANF), to name just one example. I've never been a huge fan of J. Crew's styles, but I know some people who are fond of the retailer -- and even they've seemed a bit disillusioned by a perceived discrepancy between the price and quality of its merchandise.

J. Crew's IPO and subsequently rising stock price has obviously made it interesting to many investors, but I just had too many reservations to feel confident about considering it for my Stocks 2007 pick. Instead, I chose a retailer with plenty of room for future growth, promising ancillary retail concepts and strong brands, zero debt, dedicated management with founder on board, and what I believe are temporary issues that have resulted in a sagging stock price this year.

One share of J. Crew is far less expensive than one of its cashmere sweaters, but that certainly doesn't make this stock cheap. Nor is it necessarily the sort of solid long-term investment that Fools strive to identify. That's what Stocks 2007 has to offer, for this year and beyond. Stocks 2007 is hot off the presses -- check it out today, risk-free, and shop around for some of the best investment ideas for the coming year.

Alyce Lomax does not own shares of any of the companies mentioned. The Fool has a disclosure policy.