CIT Group (NYSE:CIT) isn't going to wither away anytime soon, so retailers don't have to worry that long and lean will be the fall fashion statement for consumers.

On the whole, though, retail, with depressing same-store sales numbers and down market prospects, hasn't been the spot for investors. Back in January, I took a look at retailers and restaurants with elevated bankruptcy potential. Since then, Eddie Bauer has taken the plunge, purchased by private-equity firm Golden Gate Capital after it filed for bankruptcy in June.

Our other two bankruptcy prospects -- Stein Mart (NASDAQ:SMRT) and Caribou Coffee (NASDAQ:CBOU) -- have taken off since I last looked at them. So, what gives? And who's in danger of losing it all next?

Is cheap fashion en vogue?
For months, Stein Mart has delivered a new message to consumers: Buy our "upscale" clothing at value prices. While comps haven't turned positive yet, 2009 year-to-date same-store sales of -6.5% are improved from last year's drop of -10.9%.

Back in January, Stein Mart served up a quick ratio of 0.50, debt-to-equity ratio of 0.42, and very weak free cash flow. However, Stein Mart aggressively cut sales, general, and administrative costs to help pay down all of its outstanding debt. The company's quick ratio has dropped to 0.3 -- it also used a bunch of cash to pay off that debt -- but its current ratio of 1.9 is decent considering the current environment.

Stein Mart's stock price has increased some 750% in the past six months, increasing from the dollar menu to over $10, and is almost at its 52-week high. Fool CAPS members have ranked Stein Mart as a one-star investment, and I have to say that I agree. Stein Mart's prospects haven't been favorable for some time now, and while slashing costs and paying down debt is good, I'm just not sure how Stein Mart's "upscale" but discounted product line-up will fare for long-term growth.

Key competitor Chico's FAS (NYSE:CHS) isn't as much about value as it is original clothing designs and fashions, which could position it well if this economy ever recovers. But Stein Mart doesn't have that advantage. Investors should be glad to see that Stein Mart is keeping itself afloat, and that certainly is worth something, but there's only so much cost cutting that can happen before the company gets to skin-and-bones levels.

Caribou moves into the black
Back when I looked at Caribou Coffee in early January, it had delivered only one profitable quarter in five years, so there's little wonder that its stock lingered at dollar-menu prices through the beginning of the year. Investors were served up a round of hope as Caribou brewed up $0.02 in earnings per share for its last quarter, driven primarily by drastic cost reductions. General and administrative expenses alone were slashed by 11%.

The bad news is that Caribou's core business, sales in coffeehouses, was down by 6.6%, and although this was somewhat attributable to fewer coffeehouses open this year compared to last, same-store sales were also down 5%. The profit picture exactly mirrors the earnings reported last week by Starbucks (NASDAQ:SBUX): Sales declining + cost reduction = earnings growth.

Caribou is holding no long-term debt, which certainly puts it a step ahead of others in today's economic environment. And if Starbucks isn't growing sales right now, it's understandable that Caribou wouldn't either. But with the economy being where it is, and folks learning that they can live without coffeehouse brew, it's understandable that the Fool community would give this stock a one-star rating based on future prospects.

Who's in trouble now?
Retail and consumer products companies aren't out of the woods. Look at troubled drugstore giant Rite Aid (NYSE:RAD). The company has a storied history of ailments including not-so-seamlessly integrating Brooks Eckerd stores into the mix. Rite Aid even considered a reverse stock split to keep from staying on the dollar menu (the stock price had dropped as low as $0.20 but is now up to $1.42). Rite Aid is still hemorrhaging with a loss per share of $0.11 for its first quarter and long-term debt of almost $5.5 billion. With just $136 million of cash on hand, Rite Aid certainly has its work cut out to remain afloat.

At a current share price of $3.16, Liz Claiborne (NYSE:LIZ) isn't exactly on the dollar menu, but it is 84% off its 52-week high. Whether it's reporting a greater-than-expected second-quarter loss or delivering six straight quarterly GAAP losses, Liz is looking hopelessly out of style even with its expanding holdings of trendy names like Lucky Brand Jeans, Juicy Couture, and Kate Spade. To its credit, Liz cut into inventory and long-term debt in its last quarter, but that may not be enough to counter continued double-digit sales declines including its most recent quarterly revenue drop of 28.8%. With a quick ratio of 0.60, a total debt-to-equity ratio of 1.81, and a cloudy retail picture, Liz is going to have to go back to the drawing board to compete in this economy.

Both companies' gloomy revenue and debt picture place them as less than savory investments for the near term.

For related Foolishness:

Starbucks is a Stock Advisor and an Inside Value recommendation, plus, the Fool also owns shares. Craving more investing advice? Give the Motley Fool's newsletters a try via the 30-day free trial.

Fool contributor Colleen Paulson does not hold positions in any of the stocks mentioned in this article and is personally glad that Heelys aren't in style anymore. The Fool's disclosure policy says if it ain't broke, don't fix it.