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5 Stocks to Buy While Others Are Afraid

LULU's revenue jumped nearly 41% between fiscal year 2011 and FY 2010, from $712 million to a cool $1 billion. Ralph, on the other hand, makes more than LULU makes in a year in just one quarter. In the third quarter of FY 2012, Ralph reported revenue of $1.81 billion vs. $1.55 billion in the same period of FY 2011. You do not necessarily expect to see 16.7% revenue growth, year-over-year, from an old heritage company like Ralph Lauren, but there it is.

I'm a fan of buying the leaders in a space alongside their indirect offspring. LULU amounts to the illegitimate love child Ralph Lauren never knew he fathered. By the same token, LULU follows in her father's footsteps none the wiser.

The market crushed both stocks on Tuesday. RL was down 3.1%, closing at $163.38. The stock dove as low as $154.25 intraday. LULU shed 3.0% to $74.93, but bottomed at $70.50 intraday. Heck, if you got in at or near Tuesday's intraday lows, you've more than outperformed the guy sitting next to you.

>>To see these stocks in action, visit the 5 Stocks to Buy While Others Are Afraid portfolio on Stockpickr.

At the time of publication, the author was long LULU and RL, with plans to buy ATVI, EA and ZNGA this month.

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SYM TRADE IT LAST %CHG
ZNGA $2.45 0.00%
EA $56.03 0.00%
LULU $66.70 0.00%
AAPL $124.75 0.00%
FB $80.78 0.00%

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