hhgregg (NYSE: HGG) is a specialty retailer of consumer electronics, home appliances and related services. The firm operates 97 southeastern and midwestern U.S. stores, under the names hhgregg and Fine Lines. It also operates a retail Web site. Offerings include notebook computers, televisions, DVD recorders, refrigerators, ranges, dishwashers, freezers, washers, dryers and Serta mattresses. Competitors include Best Buy (NYSE: BBY), Circuit City Stores (NYSE: CC) and Wal-Mart (NYSE: WMT).

The company pleased investors earlier in the month, when it reported solid Q4 results and offered FY09 EPS guidance in-line with the consensus Street view. Management attributed success to increased sales of higher-priced video and major appliance products. Plans call for opening 15 to 17 stores, during the new fiscal year.

HGG shares popped on the news and then moved into a bullish "pennant" consolidation pattern. Prices frequently exit pennants moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Brokers recommend the issue with three "strong buys", four "buys" and two "holds". Analysts see a 20% average annual growth rate, through the next five years. The HGG Price to Sales ratio (0.32), Price to Cash Flow ratio (11.97), Sales Growth rate (14.41%), Return on Investment (11.96%) and Return on Equity (43.70%) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 45% of the outstanding shares. Since going public last July, the stock has traded between $7.76 and $17.22. A stop-loss of $10.65 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold positions in any of the stocks mentioned above.