These 4 Stocks are a Shoe-In - Investment Ideas

There has been plenty of speculation about how holiday sales will turn out this year, but if recent trends in sales and consumer confidence are any indication, it could be a better showing than many analysts had recently expected.

One of the most encouraging developments we have seen over the last week was the great turnout for Black Friday, where a number of retailers reported record results. That list includes Limited Brands, Inc. (LTD), whose Victoria's Secret store notched a single-day sales record between its online and retail operations. JC Penny Company, Inc. (JCP) was also in the mix, recording the best Black Friday in the history of the company after online sales jumped 12% from last year.

That strong momentum from Black Friday carried over to Cyber Monday, where sales were up an impressive 20% from last year, coming directly ahead of a report a few days later that showed retail sales were up 6% in November as consumers flexed some muscle and loosened the pursue strings.

So clearly, we are seeing some excellent momentum come to life in retails sales directly ahead of the holidays, a fact that bodes well for the sectors top performers.

How Do I Play the Trend?

Which brings me to my next point; how to play the trend?

As the momentum strategist at Zacks.com, I spend a lot of time looking at high-flying stocks, and over the last few weeks, I have seen so many shoe companies come across my screens that I actually started to wonder if shoes came out of the ground like oil or gold.

Here are four of the best, supported by strong sales and robust demand, a great way to capitalize on what is shaping up to be a relatively strong showing from the retail sector this holiday season.

Four Awesome Shoe Stocks

Steve Madden (SHOO) has more than doubled since March, recently hitting a new multi-year high at $46.76 after reporting its fourth earnings surprise in as many quarters in late November. With a bullish next-year estimate calling for 14% growth and a reasonable valuation, this Zacks #2 rank stock is looking strong ahead of the holidays. Take a look below.

DSW, Inc, (DSW) is also a leader in the shoe space, with its share price jumping 60% since September after recently hitting a new multi-year high at $41.85. The discount-retailer, also a Zacks #1 rank stock, has an average earnings surprise of 10% over the last four quarters and boasts a 9% growth projection. Take a look at the nice move below.

Foot Locker, Inc. (FL) has also been hot of late, recently surging to a new multi-year high after reporting an awesome, Q3 earnings surprise of 94% in late November. This Zacks #1 rank stock is projected to grow its earnings by 14.5% next year, take a look below.

Deckers, Inc. (DECK) is the last of the group, but certainly not the least, with shares recently surging to a new all-time high of $80 on a 15% Q3 earnings surprise. With a Zacks #1 rank and bullish next-year estimate calling for 11% growth, Deckers looks well positioned for a strong holiday showing. Take a look at the chart below.

Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the new Zacks Momentum Trader Service.
 
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