It looks like today Germany will take away what Japan gave investors yesterday.

I think this just highlights how tough it is to value stocks right now. The global economy is slowing, but if we don’t know by how much, we’re just guessing at share prices.

Yesterday, August 15 global stock markets rallied when second quarter GDP in Japan fell by an annualized rate of 1.3% instead of the 2.5% decline economists had forecast.

Today an unexpected stall by the German economy has taken down European stock markets. The German DAX index was down almost 1.9% as of 11:30 a.m. in Europe. The French CAC 40 and the Spanish IBEX 35 indexes were each down 1.4%.

The problem is data released this morning showing that GDP in the 17-country EuroZone rose by just 0.2% in the second quarter. Read more

Find me some growth! Please! Anywhere in the world.

Europe isn’t growing—the weaker economies are all locked into austerity budget cuts. The U.S. isn’t growing—unless you call 1.3% annual growth in the second quarter growth—and the budget cuts in the debt ceiling deal sure aren’t going to accelerate this economy. India is slowing. Brazil is slowing. Even China may be slowing.

So is it any wonder that the stock market is in a deep, deep funk. (Maybe we should call a 512-point drop on the Dow Jones Industrial Average something more than a funk, huh?) Sure stocks are reasonably priced or even cheap by historical standards—but that assumes something like normal economic growth. Do you see it? Anywhere?

And let’s be very clear on this: Without some growth there’s zero chance that the deeply indebted developed economies are going to dig their way out of debt. Or that stock markets will regain their legs and reverse the 10% drop of the last nine days.

What’s an investor to do? Well, as my contribution I’m going to give you 10 stocks that I think can still give you some earnings and revenue growth even in this slow global economy.

But let’s start with a quick survey of the growth—or lack thereof—landscape. Read more

In the current slow growth economic environment I’m looking for shares of companies that can turn modest top line growth in unit volume into better than expected bottom line earnings growth.

And that’s exactly what EI DuPont (DD) reported on July 28 for its second quarter of 2011. Earnings of $1.37 a share were 2 cents a share above consensus and revenue climbed 19% from the second quarter of 2010 to $10.26 billion, above the Wall Street estimate of $9.9 billion.

But to see what I mean look at how DuPont got that 19% increase in revenue. Just 2 percentage points came from higher volumes while a whopping 11 percentage points came from higher local prices. (Exchange rates and a shift in the company’s sales mix toward higher margin products account for the rest of the revenue gain.)

This was true in business segment after business segment and most importantly for investors looking beyond the current quarter in DuPont’s performance coatings—known to you and me as auto paints—unit. Sales in that segment rose 15% from the second quarter of 2010. Of that 1 percentage point came from higher volumes and 14% from higher prices.

Why is that important? Read more

Buy Qualcomm QCOM

Buy Qualcomm (QCOM).  In the current stock market and economy you want to own stocks in the sectors of the market that are outperforming rather than lagging and you want to own companies that can grow even when the economy isn’t. I think cell phone chip-maker Qualcomm fits the bill on both accounts.

First, technology has been one of the strongest sectors this year. Witness the 16% return for the technology-heavy NASDAQ Composite Index in the first six months of 2009 versus the 1.8% gain for the Standard & Poor’s 500 stock index. Qualcomm shares have done even better, climbing 27% from the beginning of the year through June 30.  In a market like this you want to buy relative strength. (The shares have dipped about 10% in the current correction creating a decent buying opportunity.)

Second, Qualcomm has recently raised estimates for the fiscal year that ends in September 2009 and looks likely to outgrow both the U.S. and the global economy over the next 12 to 18 months. With next generation 3G wireless phone systems rolling out around the world, Qualcomm’s handset volume is projected to climb by 10% in the June quarter from that same quarter in 2008. A lot of that growth is coming from the world’s emerging economies—in Brazil, for example, the shift to 3G smart phones is just gaining momentum. Networks built on 3G technology use some flavor of the CDMA standard where Qualcomm’s patent position is strongest. The current market leading GSM standard now controls about 60% of the market so Qualcomm will see its global market share grow as the rollout of 3G technology moves market share toward CDMA.

That should make up for any slowdown in the U.S. market. Thanks to its patents Qualcomm collects a royalty on phones sold by Motorola, LG, Samsung, and other companies. Royalties and license feels make up about 40% of company revenues and come with an operating profit margin of near 90%. The other 60% of the company’s revenue comes from its chip-making business. Most of those chips go into the wireless phone sector but  Qualcomm is also moving into a new business. Its chips, built on the low-energy platform from ARM Holdings (ARMH), are on the march from cell phones to smart phones to net book computers, where they look like a winner against Intel’s (INTC) current generation of low-power Atom chips. That’s a whole new growth business for Qualcomm. The company is set to report earnings on July 22. As of July 15, I’m adding these shares to Jubak’s Picks with a target price of $55 by March 2010. (Full disclosure: I own shares of Qualcomm in my personal portfolio. I will be adding more three days after this note is posted. As is the rule for Jubak’s Picks, I won’t sell my personal position until three days after I’ve posted a sell on this blog.)