Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, embattled retailer Sears Holdings (Nasdaq: SHLD) has received the dreaded one-star ranking.

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

Sears facts

Headquarters (Founded) Hoffman Estates, Ill. (1899)
Market Cap $6.09 billion
Industry Department stores
Trailing-12-Month Revenue $42.7 billion
Management Chairman Edward Lampert
President/CEO Louis D'Ambrosio
Return on Equity (Average, Past 3 Years) (0.6%)
Cash/Debt $624 million / $4.55 billion
Competitors (Nasdaq: AMZN)
Target (NYSE: TGT)
Wal-Mart (NYSE: WMT)

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 31% of the 2,155 members who have rated Sears Holdings believe the stock will underperform the S&P 500 going forward. These bears include gatzbp and mrkhan1024.

Just last month, gatzbp succinctly summed up the Sears Holdings bear case: "Business model that will become more and more obsolete."

In fact, Sears Holdings sports a particularly paltry three-year average return on capital of 2.1%. That's much lower than that of competitors like Amazon (15%), Target (9.4%), and Wal-Mart (12.8%).

CAPS member mrkhan1024 expands on the Sears Holdings underperform argument:

Black Friday was a disaster. $6.2B market cap is still too high. Net tangible assets down to $3.2B as of last quarter. The value of their real estate will continue to plummet if Barnes and Noble, Best Buy, or other [bricks and mortars] close stores or fold. They may be in bankruptcy before commercial leasing and the economy turn around. Craftsman and Kenmore branding opportunities are worth something, but will possibly kill off what little foot traffic remains.

What do you think about Sears Holdings, 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!

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