Three Growth Stocks for a Bear Market

BOSTON (TheStreet) -- Investors who fear that U.S. equities could decline further should consider the following stocks. These fast-growing companies are likely to outperform if the European debt crisis continues to roil markets.

ITC Holdings(ITC) is an electricity provider in the Midwest. During the past three years, it has increased revenue 30% annually, on average, and boosted net income 42% a year. Its stock has returned 2.7% a year during the same period.

Quarter: First-quarter profit increased 19% to $34 million, or 67 cents a share, as revenue grew 3.4%. The operating margin extended from 48% to 53%. ITC has $67 million of cash and $2.5 billion of debt, equal to a debt-to-equity ratio of 2.4.

Stock: ITC has advanced 19% during the past year, trailing U.S. stock-market indices. It trades at a price-to-projected-earnings ratio of 15, a 23% premium to the industry average. It's also expensive based on book value, sales and cash flow.

Consensus: Of analysts covering ITC, five, or 56%, advise purchasing its shares and four recommend holding them. JPMorgan Chase(JPM) offers a price target of $64, leaving a potential 30% return. Credit Suisse(CS) predicts the stock will hit $62.