How to Pick Winning Retail Stocks, Pt. 2

Upper management with seasoned backgrounds. Even better is a long-term track record with the current company in various positions. That shows that upper management knows the company from the inside out.

Strong catalysts for strong growth next year and beyond. Find out what your retailer plans to do differently this year and next. Sure, if a company has gotten this far in your research process, it has a solid fundamental track record. But what's going to keep that furnace stoked? Look for something new and exciting that will get shoppers fired up.

If you haven't already done so, check out the company's Web site. A solid Web presence is essential to any retailer these days. Look for an easy-to-use, user-friendly Web site that makes shopping a snap. If the retailer's Web site doesn't blow me away, I'd still move forward with the trade, but I'd look for some Web site improvement in the future.

At this point, you probably already have picked which retail stock will be your next purchase. But before you send your order, scan the latest news on the company to make sure nothing significant has popped up recently.

Then pull the trigger, and you should be able to sit back and enjoy the ride.