Upscale retailer Williams-Sonoma, Inc. (WSM), which I first wrote about on December 14, 2009 at a price of $22.00, is a rare retail play that has promise, and I obviously still like the shares here.

Look for Sonoma's sales to increase a healthy 8-10% in 2010, admittedly against easy comparisons, but investors will take the upside, just the same. Further, the argument forwarded here calculates that higher-end retail chains like Williams-Sonoma will bounce back sooner than the general-consumer retail segment. Hence, the 'frugal consumer' trend remains in force, but high-end consumers, encouraged by a recovering U.S. economy, will start to part with a few more bucks at the mall.

TJX Companies (NYSE: TJX) is the largest, family / off-price apparel and home fashion retailer in the United States, boasting seven retail concepts.

Readers of this space know that, given the uncertainties regarding U.S. economic growth, household formation, and job creation, the retail sector is to be avoided. Still, there are exceptions, and with the aforementioned in mind, TJX Companies is worth a review.

In general, analysts expect F2009 revenue to increase 5-7%, including a 3% same store sales increase. The flagship Marmaxx Group (operator of the T.J. Maxx and Marshalls stores) should lead the way, with better brands and increased productivity. A solid performance is also expected from the HomeGoods retail chain.

Further, operating margins are expected to improve, due to increased higher-mark-up sales, diligent control of expenses, and the company's 2500-store buying power advantage. TJX's TJ Maxx and Marshalls stores have become a destination of choice for value-oriented consumers seeking 20-40% price reductions on brand-name apparel. Further, those two chains may benefit in 2008 as certain shoppers, stung by decreased disposable income due to rising energy costs, seek to lower their clothing budget. The Reuters F2009/F2010 EPS consensus estimates for TJX are $2.22/$2.44.

The risks? TJX remains vulnerable to sudden changes in consumer apparel preferences.

The First Call mean rating for TJX is: Buy. [19 firms.] Mean 2008 target: $36. [high: $38, low: $33.]

Stock Analysis: TJX Companies is a moderate-risk stock not suitable for low-risk investors. Investors with an investment horizon longer than 2 years should be rewarded from TJX's shares. Sell / Stop Loss if you were to purchase shares in this company: $23.

Disclosure: Lazzaro has no positions in stocks. In addition to private real estate holdings, he owns corporate and municipal bonds, and cash certificates of deposit.