Consider the word Wolverine. What comes to mind? Maybe Marvel's popular X-Men character, or visions of a claw-footed mammal. Now conjure up the image of a pair of leather boots from Wolverine World Wide (NYSE:WWW). Aside from selling its namesake footwear, Wolverine offers the popular HushPuppies brand and licensed footwear from Harley-Davidson (NYSE:HDI), Caterpillar (NYSE:CAT), and TheStanley Works (NYSE:SWK).

Business has been going well over the past three years at Wolverine. The stock has had quite a run. But yesterday's second-quarter report hinted at a slowdown. Revenue growth was 8.5% over the second quarter of 2004, down from 11.6% growth quarter-over-quarter a year ago. Net income growth also slowed to 20.7%, down from 27.5%. In the report, management also reaffirmed its fiscal '05 diluted EPS guidance of $1.22 to $1.27 per share. At the mid-range, this means year-over-year EPS growth of about 15%. Not enough for some investors, apparently, since the stock dropped a little more than 6% on the news.

Be careful about focusing too much on these quarterly growth rates, though. Take a long-term view instead. Wolverine has been in business since 1906 and sells a product with no danger of obsolescence. In this type of industry, investors have important advantages. First, it's easier to predict long-term cash flows -- and if you can do that with a reasonable degree of certainty, you can value the shares. Second, companies with a competitive advantage can put up steady growth for an investment lifetime. Buy into a hot software company and those long-term numbers may never materialize. With shoes, your chances are much better.

Another company with long-term earnings potential is Timberland (NYSE:TBL). By focusing on its namesake brand and avoiding acquisitions, Timberland has been putting up excellent numbers. Based on fiscal 2004 operations, the company earned net profit margins of 10.2% vs. Wolverines' 6.65%. Timberland also shines when comparing fiscal 2004 returns on equity: 32.5% vs. 14.8%.

Before jumping into these stocks, however, understand the drawbacks that come with selling shoes. Competition is stiff, and demand is cyclical. Also, fickle fashion trends and a variety of styles and sizes make inventory an ongoing problem. Nevertheless, a company with staying brand power can overcome these hurdles. If that same company is well-run and trading at a discount, buy it. You'll be a shoo-in -- or should be say a shoe-in? -- for market-beating returns.

Click here to see Wolverine's Q2 numbers in depth.

In the most recent issue of Motley Fool Hidden Gems , Tom Gardner singled out a company similar to Wolverine. Both are in the apparel industry and both have a long history of profitability. Click here to get a one-month free trial of the newsletter and discover Tom's latest recommendation.

At the time of publication, Fool contributor Matt Thurmond had no financial position in any company mentioned in this article.