Department store operator Kohl's ( KSS) is considered to be "best of breed," as its merchandising initiatives continually led to market share gains and higher profit margins. Earnings per share hit a record $4.30 in fiscal 2012, and they are expected to reach $4.50 in the current fiscal year and approach $6 by the middle of the decade if the national unemployment continues to fall and consumer spending continues to rise.

Meanwhile, this stock has fallen from $75 in 2007 to a recent $48. Connect the EPS forecast and the current stock price and you see a mismatch. Just trading back up to 10 times possible mid-decade profits brings this stock right back to $60.

Kohl's, one of Highbridge Capital Management's holdings, shows up on a list of Consumer Discretionary Stocks Bought and Sold by Hedge Funds in the most recently reported quarter.

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