The "Fast Money" traders debated whether it's time to chase the rally in retail.
The SPDR S&P Retail ETF has gained nearly 12 percent since June 27.
Trader Pete Najarian said that investors are still looking for cheap stocks with a dividend yield. In particular, Najarian said that the companies with off-price businesses like Nordstrom Rack and TJX are better positioned. Shares of TJX hit an 52-week intraday high of $80.93 on Monday.
Trader Tim Seymour said that a lot of these retailers are starting to see their online business "working out." He cautioned investors about piling in because this rally isn't proof that "they've turned it around over night." Seymour said he likes Macy's the most in this sector because it has the best balance sheet and valuation.
Even though these stocks are rallying, Trader Dan Nathan said he doesn't think investors should "chase any of them." He said that while there may be some incremental improvements, "they have the wrong business models."