Check out Credit Suisse going to camp.
 
Credit Suisse retail analysts have divided retailers into four camps, essentially picking what they see are winners and losers in what they call a “deep consumer recession” that will continue through mid 2009.
 
That weakness will lead to consolidation in the industry, which will be a plus for the leading retailers, the analysts said in a research note.
 
Among the winners: Home Depot, Lowe’s, PetSmart and Dick’s Sporting Goods. All those stocks were upgraded to “outperform” from “neutral.”

“Broken franchises” include Sears, Borders and Office Depot.

The other two camps are market share leaders where the stocks do not yet reflect the potential downside, including Barnes & Noble; and special situation stocks like OfficeMax that seem cheap even if they are not the best positioned companies.

“In a capital stressed world, our leading franchises have strong and stable cash flows, and their stocks tend to outperform not just early in the cycle but also when the outlook seems the weakest,” the analysts wrote.
 
Home Depot and Lowe’s could benefit as the housing market seems to be near a bottom, the analysts said.
 
Oh, and Credit Suisse also used the opportunity to lower earnings estimates for several retailers. Of the 24 stocks it covers, its estimates are lower than average on 22, and by an average of a whopping 12 percent.
 
Also in the basket:
 
September retail sales fall 1.2 percent
 
Coca-Cola third-quarter profit tops Wall Street view
 
Diageo on track to meet profit margin after Q1
 
New Ceo, new Kellwood (WWD, subscription required)

 (Reuters photo)