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Beyond Wal-Mart, Retailers Are Still Ahead of the Pack

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Forget the headlines about Wal-Mart Stores Inc. cutting orders and J.C. Penny Co. needing more money -- retailers as a group have the strongest earnings growth of all the sectors that make up the S&P 500:

Insight&Action

As goes growth, so go returns. Retailers are also the best performing group in the S&P 500, after gaining almost 30 percent so far this year. The next closest is health care, which as a group has added 26 percent, followed by industrials, which rose 22 percent. Retailers have led the market nearly every week this year.

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Today we have ten retailers that are at the top of this leading sector. I screened for earnings growth of at least 12 percent in both 2013 and 2014, based on consensus estimates of the analysts tracked by Bloomberg. Additionally, I considered only those companies with a price-to-earnings ratio of less than 20x.

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Insight&Action

Several companies narrowly missed 12 percent growth, but they are still worth a mention -- so here they are exclusively for blog readers: Ann Inc. (ANN ), Group 1 Automotive Inc. (GPI ), HSN Inc. (HSNI ), L Brands Inc. (LTD ), Ross Stores Inc. (ROST ) and, curiously, funeral-home operator Service Corp. International (SCI ) -- aging demographics, or just a destination for JCP?

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