Seems as though the markets are already pricing a recession into equities, despite the fact that almost all the indicators still point to slow, but steady growth. So here is the question: What are investors to do in a scenario that looks bleak but offers few investment alternatives? One way is to steer clear of high-momentum, low-earnings stocks. They already have been obliterated and could fall more.

A new Jefferies research note for this week focuses on growth ideas with solid earnings underpinnings. We screened the list and found three that look like they make very good sense for investors right now. The three are all rated Buy and are more suitable for aggressive growth accounts.

Alphabet

The technology giant is a top pick on Wall Street for 2016 and reported incredible fourth-quarter numbers. Alphabet Inc. (NASDAQ: GOOGL) through its subsidiaries, builds technology products and provides services to organize information.

Google remains the undisputed leader in Internet search, and when you add in a diverse portfolio that includes everything from the Android platform, to YouTube, to the Google Wallet for automatic pay, to the Google Flights tool, continued growth is not out of the question. YouTube watch time accelerated a massive 60% year-over-year, and the average view session was up 50% to 40 minutes. The YouTube surge represented the best growth in two years.

Many Wall Street analysts have lauded the numerous upcoming catalysts and point out that the company showed consistent revenue growth, margin stabilization and finally gave cash back in the form of a $5.1 billion stock buyback last year. Last, but certainly not least, the company remains one of the best overall portfolio plays that focuses on the biggest Internet trends: the mobile/multiscreen shift, wearable devices, video, the Internet of Things, and much more. Alphabet delivers investors the full package.

The company reported outstanding earnings that continue to astound by posting constant currency growth of 24%, and non GAAP earnings per share that jumped 26% year over year. Jefferies cites YouTube, mobile growth and the aforementioned stock buyback as continuing positives and reasons for owning shares.

The Jefferies price target for the stock is $950, and the Thomson/First Call consensus target is $924.07.The stock closed trading on Monday at $704.16 per share.
Edwards Lifesciences

This company pioneered the artificial heart valve and could be poised for big growth. Edwards Lifesciences Corp. (NYSE: EW) provides products and technologies to treat structural heart disease and critically ill patients worldwide. It offers trans-catheter heart valve therapy products, comprising trans-catheter aortic heart valves and their delivery systems for the nonsurgical replacement of heart valves. The company also provides surgical heart valve therapy products, such as pericardial valves for aortic and mitral replacement, and minimally invasive aortic heart valve system, as well as tissue heart valves and repair products, which are used to replace or repair a patient’s diseased or defective heart valve.

Jefferies thinks that the company’s acquisition of privately held CardiAQ makes good sense going forward. CardiAQ has human implants of trans-catheter mitrial valves, and Edwards is focused on the mitrial valve opportunity after is very strong success in aortic valves. The company also has had tremendous success with trans-catheter valve replacement. Trans-catheter heart valve replacements are rapidly gaining favor in the medical community for use in those patients who are deemed unsuited for open heart surgery, and it are a fast growing revenue stream for the company.

Edwards Lifesciences posted very solid quarterly numbers, and the analysts noted more centers were adopting what is called trans-catheter aortic valve replacement, and the number of procedures is increasing. U.S. sales grew 50%, versus the 35% posted in the previous quarter.

Jefferies has a $100 price target, while the consensus figure is at $90.93. The stock closed Monday at $76.97.

Qlik Technologies

Shares of this top company are down 40% since last fall. Qlik Technologies Inc.’s (NASDAQ: QLIK) QlikView Business Discovery platform lets people quickly bring data sources together to create dynamic visual applications that can be navigated and searched intuitively. QlikView uses Natural Analytics to reflect the way human curiosity searches and processes information, while delivering the enterprise manageability, governance and service offerings organizations require.

Qlik Technologies was named in the spring the top “cross-industry” vendor in the KLAS Report, “Healthcare Analytics: Moving Toward the Continuum of Care,” for having the best understanding of health care analytics and for being considered one of the most important vendors to a customer’s organization in terms of its future business intelligence and analytics (BIA) plans.

Its new Qlik Sense product has helped push the company in the BIA market, but the recent earnings were just in line and guidance was weak, with the company citing soft spending and competition, and the long price decline for the stock has continued. The Jefferies team feels that Qlik Technologies could be taking business from Tableau Software, and they hear that spending is positive.

The $46 Jefferies price target is higher than the consensus estimate of $40.68. The stock closed most recently at $19.65 per share.

While all three stocks are more aggressive, they also all have solid earnings potential going forward. Companies unable to drive revenue to the bottom line are in the sights of the sellers and need to be avoided.

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