Shoppers love a bargain. With investors still contenting with higher prices thanks to years of above-average inflation, companies that cater to finding a bargain continue to post strong results.
That’s especially true with apparel retail. Shoppers are more than willing to open up their wallets if they can get what looks like an exceptional bargain on clothes. And a few companies have a business model that allows them to thrive in this challenging environment.
The industry leader for this trend is likely The TJX Companies (TJX), parent of TJ Maxx and Home Goods. TJX just reported great earnings, and also noted that their full-year fiscal guidance would be higher than expected.
That helps buck the recent trend of retail fears, but also provides a sign that consumers remain bargain conscious.
Over the last year, TJX shares are up 26%, about in-line with the overall market. With growth accelerating, the uptrend is likely to continue.
Action to take: Shares are in a strong uptrend, and interested investors may want to pick up shares here as a momentum play. Look to take profits when the uptrend stops.
For traders, the January 2025 $130 calls, last trading for about $2.75, could see mid-double-digit returns or higher on a further uptrend into next year.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.