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TheStreet Open House

5 Bargain Stocks to Play the Resurgent U.S. Consumer

CitiTrends

The Great Recession of 2008 took a tremendous toll on lower-income consumers, as unemployment rates spiked sharply. And the spending slowdown was surely evidence at urban retailer CitiTrends (CTRN), which saw same-store sales fall in each of the past four years.

Despite the weakness in same-store sales, management has still been pursuing a broader growth strategy, opening up new locations at a brisk clip. That helps explain why total sales were able to grow at a double-digit pace in fiscal (January) 2009, 2010 and 2011. Yet with an expanded base of stores (which now totals more than 500), a stabilization and eventual rebound in same-store sales should help this retailer to generate improving top and bottom-line results.

Meanwhile, share have totally washed out, falling from $45 back in 2007 to a recent $13. Back then, this was seen as a solid retail operator targeting inner-city consumers. Once the resurgent consumer is back in evidence later this year, investors are likely to seek out the former highflyers like CitiTrends as turnaround plays.

Sony

"We're still here!" That's the rallying cry being heard around Sony's (SNE) headquarters these days. The company technology leadership in the 1980s and 1990s, led by its Walkmans and Trinitron TVs, has been supplanted by companies such as Apple (AAPL),

Apple's growth has surely been impressive, as sales are likely to reach $190 billion in the current year, compared with an expected $75 to $80 billion for Sony. Still, Apple is worth nearly $500 billion, but Sony's market value has fallen to a paltry $11 billion. Said another way, Apple has a sales base that is 150% larger than Sony's but a market value that is 4,000% larger.

In a bid to fight for market relevance, Sony is taking several steps. First, it is heavily investing in a family of new high-end smart phones that it hopes to launch later this year. The company is already a major player in the video game market, with its PlayStation gaming console, and the company aims to regain traction in the TV market, showing off a line of Ultra-HD TVs at the recent Consumer Electronics Show.

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