Navellier Growth: your source for market-beating growth stocks

Louis Navellier:

I'm sure you agree when I say that I'm pretty tired of all the bad news out there. When J.C. Penney (JCP), one of the country's largest retailers, cut its first-quarter earnings guidance, its shares tumbled 12%. Consumer spending has obviously dried up, and the economic indicators now say that we've unofficially entered a recession.

But while stocks like J.C. Penney may get hit, our Emerging Growth retail stocks, like Guess (GES), are thriving–Guess was up 9% after its recent earnings report! Trust me, this is no accident.

With nearly 30 years of investment experience and 5,163% gains to show for it–through markets both good and bad–our Emerging Growth system has perfected the art of uncovering those stocks that will not only weather the market's turbulence, but actually outperform during uncertain times.

So let's take a look at Guess. It was founded as a designer jeans manufacturer, but its operations have expanded to include upscale apparel and accessories for men, women and children. Surprisingly, its trademark ads are designed in-house. Guess sells its lines through about 290 retail and outlet stores to department stores, through more than 240 licensee stores in about 40 countries and on its website. The company also licenses its name for a wide line of accessories.

Guess' fourth-quarter earnings surged 20% to $55.2 million, or $0.59 per share, from $45.9 million, or just $0.49 per share last year. It has strong growth in Europe and Asia to thank for it. Sales rose 30% to $514.6 million. Analysts only expected $0.57 per share on $470 million in revenue, so GES posted a 3.5% earnings surprise and a 9.5% sales surprise!

Now, to be fair, Guess does predict a slower Q1, with earnings per share of $0.44 compared with analysts' $0.47 estimates. But that didn't seem to affect the stock–shares were up 2% on the news. There's no guesswork here: Well-run companies with solid earnings growth have what it takes to go the distance–even during uncertain market environments. My Emerging Growth readers are sitting on 119% profits in GES since March 2006!

Roger Hawkins, 04.01.08:

Tom Miller, 04.01.08: