Kohl's

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We're doubling down on retail for our Rocket Stocks this week, with Kohl's ( KSS). Kohl's is a big-box department store chain that operates more than 1,127 locations spread across the country. The firm targets value-conscious middle-income consumers, positioning that's paid off in spades more recently as middle class customers sought to spend less after the recession.

Unlike other department store brands, Kohl's doesn't typically anchor mall locations, cutting its overhead and helping the firm follow through on its cost focus. Kohl's has one gleaming similarity with Target: the fact that around 50% of its revenues come from private label or exclusive products. That positioning means that KSS only competes directly on around half the dollar volume that passes through its doors, and that the rest delivers bigger margins and drives customer traffic.

From a financial standpoint, Kohl's is in stellar shape. The firm has grown its sales significantly in the last few years, even during the recession, and profitability has remained consistent as well. With a manageable debt load and more than $1 billion in cash on its balance sheet, the firm should be well positioned to tackle any headwinds that come its way in the foreseeable future.

To see all of this week's Rocket Stocks in action, check out the Rocket Stocks portfolio at Stockpickr.

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At the time of publication, author had no positions in stocks mentioned.

Jonas Elmerraji is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia, and has been featured in Investor's Business Daily, in Consumer's Digest and on MSNBC.com.

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