Market Spotlight: Unique Apparel

The apparel sector has been hard-hit as consumers cut back amid rising food and gas prices, declining home values and tightening credit. In addition, analysts say there have been few "must-have" apparel trends recently and a lot of sameness across many apparel stores.

Yet some companies have found success offering unique items. Vancouver-based Lululemon Athletica Inc., which went public last July, has built a name for itself by offering yoga-inspired athletic wear, including shorts and tank tops.

"In this environment, the customer who shops for apparel seems to be responding to things that are different, that she doesn't already have in her closet," said RBC Capital Markets analyst Howard Tubin. "There's not a whole lot of other apparel or athletic apparel as differentiated as what you can find in a Lululemon store."

Earlier this month the company said its first-quarter profit more than doubled as sales rose 75 percent and same-store sales grew 28 percent. Same-store sales, or sales in stores open at least one year, is a key metric of a retailer's financial health because it measures growth at existing stores rather than newly opened ones.

Another standout, analysts say, is Urban Outfitters Inc. The Philadelphia-based company operates namesake stores as well as Anthropologie and Free People stores. All three offer eclectic styles, both in apparel and home goods, that are difficult to find elsewhere. Same-store sales rose 10 percent in May, while apparel retailers, on average, reported same-store sales rose 2.5 percent, according to a poll by Thomson Financial.

"All three concepts continue to showcase some of the most fashion-forward product in the mall, and the merchants are continuing to take appropriate fashion risks," wrote Friedman, Billings, Ramsey analyst Adrienne Tennant, who rates the company "Outperform," in a client note on Wednesday.

Deckers Outdoor Corp. has also built its business on standing out. The Goleta, Calif.-based company makes UGGs sheepskin boots. It also sells Teva sandals and Simple casual footwear, and just bought a small, quirky sneaker brand called Tsubo.

In April the company said first-quarter profit rose 20 percent, driven by the popularity of the spring line of its UGGs sheepskin shoes.

"They're really developing a whole brand around the sheepskin boot," Tubin said. "Its not only the boot anymore, its a full collection of warm weather and cold weather footwear."