Sometimes it's good to be a contrarian. And while the Motley Fool CAPS community uncovers loads of great stocks, sometimes I'll run across a high-rated stock -- or a low-rated one -- that makes me question their sentiment. Right now, my top pick among underrated stocks is The Buckle (NYSE:BKE).

This teen retailer has been firing on all cylinders lately, yet it's only earned a lowly two-star rating with the CAPS community. I'm not sure why it receives such lackluster community sentiment -- especially when I compare its key metrics against those of specialty retail peers with higher CAPS ratings:


CAPS Rating (Out of 5)

P/E Ratio

5-Year Growth Expectations (Annualized)

Past 5 Years' Growth (Annualized)






Guess? (NYSE:GES)










Limited Brands (NYSE:LTD)





Data from CAPS and Yahoo! Finance as of June 29, 2009.

From a quick glance at those figures, I'd say that Guess? is the only stock of the bunch that really deserves to outpace Buckle in our community's eyes. And while I often glance at analysts' growth expectations, I'll also take them with a grain of salt. I'm particularly skeptical about projections for Wet Seal, since that company has been struggling big time for the last couple of years. Meanwhile, Limited looks absurdly overpriced given its future outlook, not to mention its even less heady past growth.

I'm not entirely convinced analysts or investors realize how strong a retailer Buckle is. Even in the midst of this nasty recession, it has joined the likes of Aeropostale (NYSE:ARO) as a retail outlier. Month after month, Buckle's same-store sales have been incredibly robust month, alongside highly impressive quarterly results. To me, that says Buckle is able to resonate with its youthful customers, despite the poor economic environment. Better yet, it's packing roughly $4 per share in cash and no debt.

Last but not least, Buckle is also a fairly quiet retailer; you don't hear a lot of media hype about it, unlike more high-profile or controversial names such as Wal-Mart (NYSE:WMT) or American Apparel (NYSE:APP). Buckle may be a diamond in the rough, still beyond even the CAPS community's notice.

CAPS is a great place to find stock ideas and weigh community sentiment, much of which is often right on target. The more people who play and rate stocks, the better the collective data gets. If you have an opinion on Buckle -- whether you agree it's an underrated jewel, or think the community's collective yawn sounds about right -- head over to CAPS and let us know what you think about it.   

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Alyce Lomax does not own shares of any of the companies mentioned. The Fool has an ever-stylish disclosure policy.