Focus On Long-Term Growth Stocks by Mike Vodicka

As we move into 2009, the stock market continues to be very volatile. The most optimistic projections say the beginning of an economic recovery is 6 months away, while the bearish faction believes it could still be years into the future. But trying to pick the bottom of the market can be a fool's errand for even the smartest and most experienced investors.

The only thing anyone agrees on is that it will happen, with Warren Buffet saying recently, "It's never paid to bet against America, we come through things."

And since most investors are in the market for the long-haul anyway, it is best to focus on a long-term growth strategy that is designed to produce steady gains when market conditions improve. This approach is particularly relevant in our modern economy where companies and industries can quickly fall in and out of favor.

Screening For Great Stocks

In order to find the stocks with the most compelling long-term growth projections I enlisted the help of the Zacks Research Wizard, using two key criteria.

* High 3-5 year EPS growth projection
* Low P/E multiple

The following four companies each offer a unique combination of growth and value in industries that should perform well as conditions improve. Take a look below.

Long-Term Growth and Value

Almost Family, Inc. (AFAM) provides home healthcare services domestically. This company continues to rack up big gains as strong demand from an aging domestic population keep its profits growing. Almost Family's 3-5 year EPS growth rate is pegged at an impressive 33.50%, with the next-year estimate pegged at $2.56 per share, a 24% earnings growth projection.

Southwestern Energy Company (SWN) operates as an independent natural gas exploration company in the United States. The analyst community is bullish on the company's long-term prospects, with the 3-5 year EPS growth projection standing at an impressive 47%.

Zhongpin, Inc. (HOGS) is a meat packing and distribution company out of China. This company provides a unique combination of growth and value, with its 3-5 year EPS growth projection pegged at 30% and shares currently trading with a forward P/E multiple just a pinch below 7X, deep in value territory.

Shanda Interactive Entertainment Limited (SNDA) is an Interactive media company based in China. This company has produced impressive results in a tough environment, having beat estimates in each of the last four quarters. Analysts are projecting a 3-5 year EPS growth rate of 21%.

Conclusion

More volatility is almost a certainty for the remainder of the year as the market continues to work its way through a challenging period. But a long-term growth strategy enables the investor to sidestep the madness of trying to pick a bottom and participate in a macro-level recovery when it occurs.


Michael Vodicka is a Momentum Analyst at Zacks Investment Research covering Momentum stocks. He also contributes to the Zacks Elite website to Target Recommendations and Stock of the Day. For more information please visit http://www.zacks.com

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