Yikes! The Dow closed below 8,000 yesterday, and retailers have been hit especially hard by the struggling economy. Well, at least people are still buying their little ones new clothes.

Both Gymboree (NASDAQ:GYMB) and The Children's Place (NASDAQ:PLCE) delivered EPS growth in their third-quarter earnings results.

It's not a perfect picture, but in today's retail climate, the news is pretty good. Gymboree delivered a 16% increase in diluted EPS, increasing earnings per share from $0.91 to $1.06. Retail net sales increased by 6%, while same-store sales dropped by 2% for the quarter. The company is forecasting a middle-single-digit decline in same-store sales for the fourth quarter on concerns of a slow holiday season.

The Children's Place, in the process of exiting the Disney Store business, generated a 27% gain in earnings per share when considering continuing operations, growing from $0.66 per share to $0.84. Same-store sales actually increased by 2%, while net sales grew by 5%, although the company shared anxiety over a "challenging" holiday season.

Gymboree was up more than 20% as of late this morning, since the company beat earnings expectations. Even with these gains, the stock is down more than 41% over the last year and is trading at around six times this year's expected earnings. That's a bargain-basement level compared to just a few months ago, when the P/E registered at 12. For reference, the company features pricier clothing options than indirect competitors such as Sears Holdings (NASDAQ:SHLD), Wal-Mart (NYSE:WMT), and Target (NYSE:TGT), which makes it a little less attractive in times like these.

Even though the stock was down slightly today in early trading, I think that The Children's Place in particular seems well-positioned for the current economic climate. I've been checking out the retail offerings in person, and the clothing prices at The Children's Place are in line with the value that parents are looking for, especially at the outlets. The market agrees, awarding the company a P/E multiple of 8 times this year's expected earnings.

On a recent Sunday trip to the outlet mall, I noticed parents stocking up on $3.99 sweaters, puffy vests, and shoes. As consumers flee from luxury retail purchases, they are going to continue to seek the attractive and well-priced offerings that The Children's Place is serving up.

Kids' retail has held up much better than teen retailers like Abercrombie & Fitch (NYSE:ANF) and American Eagle Outfitters (NYSE:AEO), which does actually make sense when you dig into the analysis. While teen retail has been thought of as recession-proof, staggering job cuts have trickled down to teens, who thus don't have as much disposable income as they used to.

If you're looking to buy retail stocks, The Children's Place and Gymboree are delivering growth when other retailers can't. Although the holidays look to be challenging this year for retail in general, kids will continue to grow and actually need new clothes. It will be interesting to see how American Eagle's new 77kids offering fares in competition with these established retailers. For now, I personally prefer The Children's Place over Gymboree, but I'd wait for a bit more stabilization in the market and in retail in general before diving in.

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Fool contributor Colleen Paulson does not hold any positions in the companies mentioned above. The Fool’s disclosure policy is the place for investors.