The whole point of failing low interest rates is to spur demand for consumers to open their wallets and spend. Over the past year, the consumer stocks are up over 20%, are there any bargains left?

Peter Ashton of Recognia Inc looked at the sector and his selection was:

Companies that have demonstrated a stock price increase of at least 4% over the past 4 weeks or past month.

Companies with growing earnings – based on analyst projections of companies whose growth rates should be about 3%.

Since the idea is to look for bargains, the average P/E ratio for the sector is 29%, looking for P/E ratios of less than 20. The idea is they can approach the average.

Company                    Mkt Cap     Price Prefor        EPS Growth     Forward         Dividend

($ bil)          (4 weeks)  %          Rate %                 P/E  %              Yield %

General Motors        46.5                7.9                      16.0                     5.4                     4.9

Whirlpool                   14.3                14.6                     19.4                     12.8                   2.0

Goodyear Tire              7.2               13.4                     20.8                       7.3                    1.0

PulteGroup                   7.2                 8.5                     19.9                     13.1                     1.7

HarleyDavidson          9.3                 9.3                    5.5                          13.2                   2.6

Harman Interntl        5.7                 23.9                  8.5                          13.9                   1.3

Thor Industries          3.9                 13.6                   24.0                       16.7                   1.6

Brunswick                     4.4                  9.5                  18.8                        14.3                   1.2

Stanley Black & Dec   18.3                10.0                 11.8                        19.3                  1.8

Linking to dividend paying stocks, making over 20% on your investments is a great thing considering the bank account returns. Government policy of low interest rates is meant to stimulate the consumer and company spending, but economy really depends on the consumer. As consumer stocks go, so does the economy. If you owned basic consumer stocks you would be wealthier but doing the things you do during the summer. It is always possible to minimize risk, and have good returns when investing in profitable stocks.

Three are more questions than answers, till the next time – to raising questions.