Five Stocks to Beat Market in 2010

More recently, though, SWHC shares have sold off significantly on concerns about future sales. Even if you assume that sales of guns will decrease from the current pace, SWHC trades for a low valuation. Analysts expect the company to make 37 cents in the current fiscal year ending in April 2010. At a price of approximately $4 per share, SWHC trades for just 11 times current year earnings.

The expectation is for earnings to grow to 44 cents in the following fiscal year. That's almost 19% earnings growth. So even if sales go down, there's a big cushion here. More likely, I think Smith & Wesson will meet or exceed these expectations. If so, this stock could double in value in a short period of time.

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Seafood is a huge part of the food chain, and it provides a vital supply of protein to a growing world, and growing that supply is what HQ Sustainable Maritime Industries (HQS) does. The company is in the business of farming hybrid tilapia and white-legged shrimp that is produced and processed in China and exported to markets including the U.S., Canada and Japan. HQS is already profitable and on track to make 74 cents per share in the year ending December 2009. Shares trade for less than 10 times that number. What about growth?

Analysts expect HQ to make 92 cents per share next year. My guess is that the company does better than that heady 24% growth in 2010. Historically, owning a stock that trades for a single-digit multiple of earnings and yet posts double-digit earnings growth tends to generate big gains for investors.

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