Based on the aggregated intelligence of 165,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, shopping mall operator Developers Diversified Realty (NYSE: DDR) has received the dreaded one-star ranking.

With that in mind, let's take a closer look at Developers Diversified's business and see what CAPS investors are saying about the stock right now.

Developers Diversified facts

Headquarters (Founded)

Beachwood, Ohio (1965)

Market Cap

$2.84 billion


Retail REIT

Trailing-12-Month Revenue

$817.1 million


CEO Daniel Hurwitz (since May 2007)
CFO David Oakes (since February 2010)

Return on Equity (Average, Past 3 Years)


Compound Annual Revenue Growth (Over Past 3 Years)



$20.9 million / $4.64 billion

1-Year Return



Weingarten Realty Investors (NYSE: WRI)
Kimco Realty (NYSE: KIM)

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 51% of the 410 members who have rated Developers Diversified believe the stock will underperform the S&P 500 going forward. These bears include twopairfullhouse and All-Star Beorn10, who is ranked in the top 2% of our community.

A few months ago, twopairfullhouse summed up the bear case with a few simple words: "[H]igh price with no support from fundamentals."

Strong stock prices, coupled with a generally shaky macro outlook, continue to make shopping mall real estate investment  trusts one of our community's least favorite investments. Shares of Developers Diversified have been particularly hot, outpacing close peers Kimco and Weingarten by about 10 percentage points so far in 2010. Developers Diversified's higher leverage ratios have certainly given it more fuel in this fairly resilient market, but if the economy stays weak for a prolonged period of time, the shares are a good bet to get slammed just as hard.

CAPS All-Star Beorn10 elaborates:

The leasing and managing part of the business may not be as healthy going forward if we continue to have persistently high unemployment and higher taxes. Internet sales may continue to expand at the expense of the more traditional shopping malls. Running a business with fewer employees and a lower rental cost, like may become the norm for many small business that were once found in the malls.

What do you think about Developers Diversified, or any other stock for that matter? If you want to retire rich, you need to protect your portfolio from any undue risk. Staying away from dangerous stocks is crucial to securing your financial future, and on Motley Fool CAPS, thousands of investors are working every day to flag them. CAPS is 100% free, so get started!