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WHAT ARE WE LOOKING FOR?

This week we're looking at hot niche sectors. Following yesterday's focus on solar stocks, let's look at natural food companies. With the incredible success of

Lululemon's initial public offering, Canadian investors have been shown a good example of the market's insatiable demand for healthy-living stocks.

As a yoga-clothing retailer, Lululemon doesn't have another stock that you can easily compare it to, but this group of companies is benefiting from a similar trend.

TODAY'S SCREEN

Let's see which companies are expected to grow the fastest and then look at price-to-earnings valuations. Lululemon is the most expensive of the bunch, but its growth is near the top of the list. We've thrown the Canadian yoga story in there just for comparison purposes - even though it has nothing to do with food (some companies, such as Gaiam, are

also more diversified than just food).

We borrowed this list of stocks from Desjardin Securities analyst Keith Howlett, who uses it to do comparative valuations for

SunOpta, a Canadian natural/organic food and ethanol company. All the data is driven by Globe

Investor and Thomson.

Company Ticker Sept. 17 close ($U.S.) 52-week high 52-week low Last fiscal year end Last fiscal year actual EPS Estimated current fy EPS growth Estimated next fy EPS growth 5-yr. EPS historical growth P/E last fiscal yr. P/E current fiscal yr. P/E next fiscal yr. Market cap. $million
Dean Foods DF-N $25.61 $37.48 $25.07 Dec. 6 $2.12 -30.8% 12.7% -1.0% 12.0 17.4 15.4 $3,329
Diamond Foods DMND-Q $16.04 $19.93 $13.40 Jul. 6 $0.48 12.9% 43.7% NA 34.0 30.2 21.0 $253
Gaiam Inc. GAIA-Q $19.41 $21.20 $11.38 Dec. 6 $0.23 41.3% 69.2% -4.0% 84.3 59.7 35.3 $374
Hain Celestial Group HAIN-Q $29.77 $31.93 $25.09 Jun. 7 $1.17 18.3% 18.6% 12.9% 25.6 21.6 18.2 $1,181
Hansen Natural HANS-Q $48.95 $50.90 $24.75 Dec. 6 $1.11 33.2% 44.3% 152.0% 44.7 33.6 23.3 $4,408
Lifeway Foods Inc. LWAY-Q $15.32 $17.75 $6.53 Dec. 6 $0.17 50.0% 45.1% 13.3% 90.4 60.3 41.5 $258
Martek Biosciences MATK-Q $25.99 $28.10 $19.64 Oct. 6 $0.63 -0.4% 34.2% 4.7% 42.0 42.1 31.4 $838
Medifast MED-N $6.09 $14.92 $5.92 Dec. 6 $0.38 -13.2% 33.3% 1.6% 15.9 18.3 13.7 $83
NBTY NTY-N $40.30 $55.14 $26.82 Sept. 6 $1.76 72.2% 4.5% 15.5% 22.9 13.3 12.8 $2,715
Reliv International RELV-Q $9.40 $11.60 $8.02 Dec. 6 $0.46 -17.4% 15.8% 23.1% 20.4 24.7 21.4 $152
SunOpta Inc. STKL-Q $13.56 $14.18 $8.35 Dec. 6 $0.19 90.5% 32.6% 9.9% 72.2 37.9 28.6 $856
United Natural Foods UNFI-Q $24.45 $38.40 $24.10 Jul. 7 $1.21 16.7% 18.6% 19.6% 20.4 17.5 14.8 $1,047
Whole Foods Market WFMI-Q $42.65 $66.25 $36.00 Sept. 6 $1.39 -2.8% 10.6% 15.0% 31.2 32.1 29.0 $6,029
Lululemon Athletica LULU-Q $34.71 $38.85 $24.92 Jan. 7 NA NA 63.5% NA NA 106.5 65.2 $2,264

SOURCES: GLOBEINVESTOR.COM AND THOMSON DATASTREAM

sadams@globeandmail.com

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