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TheStreet Open House

5 Rocket Stocks to Buy as Stocks Bounce

Gap

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2013 has been a good year for shareholders of Gap (GPS). Consumer-driven spending has buoyed shares of the $17 billion apparel retailer this year, sending shares up nearly 20% since the calendar flipped over to the new year. That means that Gap is outperforming the broad market's already impressive upside by more than double.

>>5 Consumer Stocks Ready to Push Higher

Gap's success this year has been thanks to an attractive portfolio of apparel brands. The firm's labels include Old Navy, Banana Republic, Piperlime and Athleta in addition to its namesake Gap brand. In total, the company owns more than 3,000 stores spread across the world, with another 450 franchise locations in emerging markets. The firm's model of franchising its locations in volatile areas is attractive, giving Gap access to high-growth markets without requiring high growth from its capital expenditure budget.

A long track record as a specialty apparel retailer has proven Gap's ability to stay the course, particularly in the highly fickle fashion market. Because Gap targets attractive mass affluent and aspirational demographics, both of which are ravenous consumers, it can lay claim to some hefty growth and profitability numbers when times are good. With ample cash on hand and a valuable collection of brands, Gap is in good shape to keep capturing apparel spending growth for the foreseeable future.

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