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.

The TJX Companies (NYSE: TJX) is a leading off-price retailer of apparel and home fashions in North America and Europe. The firm sells family apparel, accessories, shoes, giftware, jewelry and home furnishings through nearly 2,100 stores in the United States (T.J. Maxx, Marshalls, HomeGoods, A.J. Wright, Bob's Stores), over 250 outlets in Canada (Winners, HomeSense), and 226 T.K. Maxx stores in the United Kingdom and Ireland. Target (NYSE: TGT), Kohl's (NYSE: KSS) and Ross Stores (NASDAQ: ROST) are major competitors.

The company pleased investors last week, when it reported a December same-store sales increase of three percent (y/y) and issued upside guidance for the fourth quarter. Management now sees Q4 EPS of 60-63 cents, versus previous guidance of 58-60 cents and Street consensus of 59 cents. The CEO attributed success to disciplined inventory management and expense control. Analysts also pointed to the tendency of consumers to move to discount-oriented chains in a declining economy.

"The third quarter of the year has historically been the roughest on the stock market," notes advisor Kelley Wright, a specialist in dividend paying stocks.

In his IQ Trends newsletter, he notes, "One could argue that a correction and consolidation would be healthy and is long overdue." That being said, he adds, "The opportunity currently exists to acquire high-quality companies with long-term rising dividend trends."

Within this framework, he sees opportunity in two favorite blue chip retailers -- Wal-Mart Stores (NYSE: WMT) and TJX Companies (NYSE: TJX).

He says, "It seems like every summer we hear analysts agonize over weak retail sales from May and June. I've often wondered if any of these folks have heard of the phenomenon known as 'vacation.'"

He continues, "After a long school year with the seemingly never ending number of trips to pick up the dozens of items that the kids absolutely have to have, I know that my wife doesn't want to go anywhere near a store unless it is a medical necessity."

Says Wright, "The calendar cannot be ignored so I suspect that when Uniform Day (as they call it at my kids' school) rolls around in mid-August, parents across the fruited plain will be descending en mass to pick up clothes, shoes and the requisite supplies for another school year. And, he states, "I believe both Wal Mart and TJX Companies will be potential beneficiaries of this impending spending spree."

Wright explains, "Both companies are ranked A+ by S&P for their earnings and dividend quality. In addition, both stock have excellent dividend histories. It is a fortunate circumstance when quality and value intersect with opportunity."

Each day, Steven Halpern's TheStockAdvisors.com features the latest investment ideas and market commentary from the financial newsletter community.