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By Jason Stipp | 04-12-2010 12:23 PM

Changing Fortunes for These Four Retailers

Even as consumer spending picks back up, the market is still gazing in the rearview mirror--which could spell opportunity for investors.

Jason Stipp: I'm Jason Stipp for Morningstar. At long last, things seem to be looking up a little bit for the consumer. But what about consumer retail stocks? Here with me to dig into that a little bit is Morningstar's Paul Larson. He's the editor of Morningstar StockInvestor and an equity strategist. Thanks for joining me, Paul.

Paul Larson: Pleasure to be here.

Stipp: So it seems like we are getting some good news on the consumer front. Has the consumer turned the corner, finally? What are the signs out there?

Larson: Well, I think that the consumer has indeed turned the corner. We see same-store sales up very strongly in most recent weeks. Then, also, we see consumer confidence, which has really bounced back from the lows that we saw a couple months ago in the depths of the recession.

Stipp: Sure. So the confidence is what they're thinking, but it's actually nice to see that backed up with some improving sales as well, which we got that data recently.

So it may seem, from an investor's perspective, the consumer's out there spending again. This must be great for retail stocks. You can't lose with a retail stock when the consumer's coming back, right? But that's not always the case. You sort of see a division here. Tell me a little bit about that.

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