9 Low-End Consumer Stocks for High-End Profits

NEW YORK (TheStreet) -- With fears of an impending double-dip recession and another major stock market pullback -- further aggravated by Tuesday's third Hindenburg Omen occurrence in less than a month -- it's no wonder that there's been so much emotion in the market.

The theory is that two Hindenburg Omen occurrences within a 30-day window virtually guarantee a stock market crash. The Omen occurs when an unusually high number of companies in the New York Stock Exchange reach 52-week highs and lows at the same time. The proportion of NYSE stock highs and lows must both exceed 2.5% of the total listed on the exchange.

"Look at the market today -- it's not rational," says Neil Hennessy of Hennessy Funds. "It's just emotional. There's a perception in today's market that every company is losing money and everybody's getting laid off, and that is so far from reality. Companies are making tons -- they're paying them out in dividends and more and more is going to happen as we go forward."

This is especially true of low-end retail and low-end consumer discretionary stocks, according to Hennessy. In an interview with TheStreet, Hennessy said he believes it's hard to go wrong with these types of stocks.

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Read on for more of Hennessy's views on low-end retail and low-end consumer discretionary stocks and why he thinks they are worth the investment.

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