***Lululemon Surging in 2019

Lululemon Athletica made news yesterday when it lifted its guidance for the fourth quarter of 2018, continuing a stream of good news for the athletic wear maker.

Lululemon had estimated revenue between $1.12 and $1.13 billion, and raised that to between $1.14 and $1.15 billion. Earnings per share are now estimated to be between $1.72 to $1.74, higher than the previous estimates of $1.64 to $1.67.

This latest news reminds me why legendary investor Louis Navellier made LULU his pick in our 10 Best Stocks for 2019 contest. Louis is the editor of our Growth Investor service, and he has more than 35 years’ experience guiding hundreds of thousands of investors through every kind of market you can imagine…bear, bull and everything in between.

But he is widely known as a growth investor. Someone who can pick out the gems in any market for investor gains.

In the chart below you can see why LULU is Louis’ top pick, as it has outperformed the broader S&P substantially.

If you’re not familiar with them, Lululemon is the leader in the “athleisure” market – meaning they make athletic clothes, such as yoga pants, that many people now simply wear all the time.

Part of Louis’s evaluation of any stock is management’s focus on what makes it great to consumers. As he explained late last year, LULU’s management has impressed so far.

Even as it has grown its global footprint and customer base, Lululemon has kept true to its founding values. It differentiates itself by making some of the highest-quality and most-comfortable workout clothing that money can buy.

In fact, it has a research and development lab that devotes time to examining the human sense of touch. This commitment to comfortable clothes has helped LULU stock expand into the lucrative “comfort and lifestyle” niche.

Meanwhile, Lululemon maintains a strong presence in its local communities, offering free workshops and yoga classes in its stores. Each week, Lululemon stores and showrooms are transformed into an instant yoga studio. And the company offers free yoga videos online.

Now, I’m not recommending LULU stock because it made yoga pants mainstream. Rather, the company is expanding into mass sports distribution and capturing market share from big-name athletic apparel companies like Nike and Under Armour.

Management focus and great results for Q4 just build on what was a great Q3, when earnings of 75 cents per share outperformed estimates of 70 cents per share. Even that was substantially better than the previous quarter when the company reported 43 cents per share.

In Q3, the company reported that revenue increased 21% year-over-year to $748 million. This was also above expectations for $737.5 million. Same-store sales increased 18%, also above the expected 13.9%.

One of the things to like best about them is their commitment to online sales. In the third quarter, Lululemon’s direct-to-consumer revenue increased 46% on a constant-currency over last year and now accounts for 25.3% of revenue, up 410 basis points from a year earlier.

Even with this good news, the company is still trading below market highs from last September. The market volatility of the last months of 2018 has opened up an opportunity get into the stock.

Louis provides regular updates on his portfolios, and you can find out more on how to get his advice by clicking here.

***A Utility Stock for Investor Safety – and Dividends

Early yesterday, California utility PG&E announced plans to begin voluntary bankruptcy proceedings under Chapter 11 in the face of billions of dollars in potential liability for its role starting recent California wildfires.

The company’s web site states that PG&E provides natural gas and electric service to approximately 16 million people throughout a 70,000-square-mile service area in northern and central California.

According to The Wall Street Journal, California’s largest utility also reported Sunday night that Chief Executive Geisha Williams was stepping down. John Simon, the company’s general counsel, was made interim CEO until a successor is found.

Shares were down almost 50% at the time of this writing.

Now, what just happened with PG&E was atypical and reflects the company’s specific responsibility in starting the California fires. Utility stocks are considered some of the safest investments available to investors.

In fact, during volatile markets, like those we have seen over the last four months, many investors view utilities as a haven.

Contrary to what many think, however, utilities stocks aren’t just for the widows and orphans fund. During the past 5 years, US utility stocks, as tracked by the Utilities Select Sector SPDR Fund, have outperformed the S&P 500 Index.

Neil George, editor of Profitable Investing emphasized this point to his subscribers in a December update. Neil is a nationally-recognized expert on income and investing and emphasized to this subscribers that utilities aren’t about sacrificing return for just dividend income, and shared why a Florida-based utility, NextEra Energy (NEE), is in his portfolio.

Next Era is based in Florida and has its primarily regulated power company in Florida Power & Light. NEER generates power through a variety of sources, including natural gas, coal and oil as well as nuclear power plants. Its customers number in the millions and are primarily residential customers, with some commercial customers.

NextEra is like any other regulated power company, but it also has an unregulated side of the business, Next Era Energy Resources (NEER), that provides unregulated wholesale power around the US with some additional assets in Canada and Spain.

I’ll let Neil explain why he finds this such an attractive growth investment.

The company continues to focus more on the NEER division, which provides the namesake for the overall company. The idea is that the next era in power generation will be ever more focused on renewable energy sources. This is supported in that the revenues for the NEER unit have expanded to become 28.55% of overall revenue of the company.

The industry is benefiting from state and local legislation around the nation requiring that a portion of power be generated by renewable sources. In addition, NextEra’s renewable power expansion is also benefitting from Federal tax credits for renewable energy facilities.

These come based on capacity and not just the amount of power generated. This means that the company can operate wind and solar facilities around the nation and not just in areas that are particularly sunny or windy.

The company is a stronger performer for investors. The return on its capital is running at 13.1% while the return on investor’s equity is a whopping 27.9%. And this is resulting in the market recognizing its performance now and for the future.

The shares have delivered a total return over the past five years of 132.81%, which is more than double the return of the S&P 500 Utility Index.

Utility investing is generally considered a boring endeavor but returns from stocks like NextEra Energy make it anything but that.

Neil recommends buying this stock below $185.

You can read more of Neil’s stock analysis, including his Incredible Dividend Machine, by clicking here.

To a richer life…

Luis Hernandez, Managing Editor
and the research team at InvestorPlace.com