Based on the aggregated intelligence of 165,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, restaurant operator Ruby Tuesday (NYSE: RT) has received the dreaded one-star ranking.

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

Ruby Tuesday facts

Headquarters (Founded)

Maryville, Tenn. (1920)

Market Cap

$588.8 million



Trailing-12-Month Revenue

$1.2 billion


CEO Samuel E. Beall (since 1995)

CFO Marguerite Duffy (since 2001)

Return on Capital (Average, Past 3 Years)


Compound Annual Revenue and Net Income Growth (Over Past 3 Years)

(5.4%) and (26.7%)


$9.6 million / $322.4 million

Year-to-Date Return



Darden Restaurants (NYSE: DRI)

DineEquity (NYSE: DIN)

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

On CAPS, 56% of the 236 members who have rated Ruby Tuesday believe the stock will underperform the S&P 500 going forward. These bears include robertshrestha and fundamentalsrock.

Just last week, robertshrestha tapped Ruby Tuesday as a not-so-sparkling opportunity: "Too much competition, way too much debt, and too much of a run-up over the last 6 months. Weak return on equity. What's to like?"

The full-service restaurant space is a notoriously difficult one, with companies competing along the lines of price, service, and the type and quality of food. Darden's franchises, for example, clearly target specific tastes like seafood (Red Lobster), Italian (Olive Garden), and Caribbean (Bahama Breeze), while DineEquity satisfies a breakfast hankering with its IHOP brand. On the other hand, CAPS member fundamentalsrock, along with the rest of our community, feels that Ruby Tuesday is heavily marked by a lack of differentiation:

There is way too much competition in the sit down semi-fast food category, and the competition blows away Ruby Tuesday. They have no marketing to speak of. They are overloaded with debt. The only reason they have earnings is that the economy is improving, but any road bump and they will crash. So I am keeping my short recommendation despite what Mr. Market seems to think about this toad.

What do you think about Ruby Tuesday, 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!