How to evaluate retailer stocks: Pro

Earnings from best-of-breed companies may not be telling the retail sector's full story, Steve Kernkraut of Durban Captial said Monday.

"I think there's a lot of noise out there in retailing right now, and it's one of these amorphous periods where we just finished the clearances and back-to-school just starts," he said.

"You're seeing the wealthy spend, but how the mass market is doing is really questionable. And the only data points the public really has is names like Costco and Gap that have reported very strong sales, but they're best-of-class retailers. So, you don't know how most of the retailers in the world are doing. You don't know how Wal-Mart, Target, Macy's are doing, and I think there could be a lot of noise out there."

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On CNBC's "Fast Money," Kernkraut also said that while auto sales and housing were doing well, restaurants were performing "poorly."

"You're not going to get a clarity until you get to Labor Day, until you get a good read on back-to-school," he added.

Kernkraut said that positive consumer sentiment surveys also didn't tell the whole story.

(Read more: Beware negative earnings growth, pro warns)

"It's one thing to say to a survey that you feel good. But it's another question of whether or not you want to go out and spend," he added. "And consumers are more and more event-driven, so they're not spending until they have that back-to-school need."

"I wouldn't read Costco's 7 percent sales and Gap's 7 percent sales as the read of the general economy," he said.

By CNBC's Bruno J. Navarro. Follow him on Twitter @Bruno_J_Navarro.

— CNBC's Patricia Martell contributed research to this report.

Trader disclosure: On July 29, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Simon Baker is long AAPL; Simon Baker is long BBRY; Simon Baker is long GOOG; Simon Baker is long THC; Simon Baker is long HBC; Simon Baker is long OMC; Simon Baker is long C; Stephanie Link is long AAPL; Stephanie Link is long JPM; Stephanie Link is long WFC; Stephanie Link is long CSCO; Stephanie Link is long FB; Stephanie Link is long EBAY; Stephanie Link is long GPS; Joe Terranova is long TRV; Joe Terranova is long AXP; Joe Terranova is long OXY; Joe Terranova is long EMC; Joe Terranova is long MS; Joe Terranova is long GS; Jon Najarian is long AAPL; Jon Najarian is long DDD; Jon Najarian is long FB; Jon Najarian is long CPWR; Jon Najarian is long MAR; Jon Najarian is long MGM; Jon Najarian is long TIBX; Jon Najarian is long WLL; Jon Najarian is long ZNGA.