Big Lots, (BIG) has been a safe haven for shoppers and investors in such a turbulent market. As the economy slows, shoppers are looking for ways to stretch their weakened dollars and are turning to discount retailers. The company has just reported another great quarter driven by record inventory turnover.

Company Description

Big Lots operates, through its subsidiaries, as a discount and closeout retailer in the United States. The company offers great bargains on a variety of constantly changing products, making it a one of a kind shopping experience. Big Lots is based in Columbus, Ohio, with over 14,000 employees, and a market cap of $2.5 billion.

Record Inventory Turnover

On August 26th Big Lots announced second-quarter results Incorporatedluding earnings per share of 32 cents, a 52% year-over-year increase. Analysts were forecasting 27 cents per share making this the fourth earnings surprise in the last four quarters, averaging 18%.

Sales were up 1.9%, despite a decrease of 1% in the number of stores, as the company streamlines its distribution centers. Big Lots has improved inventory flow and distribution center productivity leading to a 2% decrease in overall inventory.

Increasing Guidance

Big Lots also increased its guidance for full-year 2008 earnings. The company is anticipating earnings per share of between $1.90 and $2.00, up from between $1.80 and $1.90. Analyst have increased estimates across the board, as most projections are coming in at the upper end of managements expectations.

Seeking Bargains In Tough Times

Many shoppers are seeking better deals in the midst of the current economic down turn. Despite the major indices dropping roughly 20%, Big Lots is up nearly 80% year-to-date.

Even after the gains for 2008, Big Lots maintains a respectable PEG ratio of 1.0, while its competitors average 1.6.

Top Ranked Discount Retailer

Big Lots is the top rated company amongst Discount Retailers on Zacks.com. The industry as a whole is ranked as the 15th out of 217.

The Zacks #1 ranked stock has solid comparisons to its competitors. A 15% 5-year growth rate tops the industry average of 12.6%. The company also has a superior ROE of 23%, easily beating the average of 16.4%.

The Chart

Shares of BIG are trading just under their 52-week high of $34.88, which has developed into a level of resistance. The stock is also setting higher lows for the past couple months, which is a bullish sign. Do not be surprised to see the action consolidate near $32 per share, if it is going to break through the resistance level.

Content Courtesy: Zacks Investment Research

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1. (BIG) – Big Lots – maintains a respectable PEG ratio of 1.0, while its competitors average 1.6Big Lots, (BIG) has been a safe haven for shoppers and investors in such a...
2. (BIG) – Big Lots – maintains a respectable PEG ratio of 1.0, while its competitors average 1.6Big Lots, (BIG) has been a safe haven for shoppers and investors in such a...
3. (BIG) – Big Lots – maintains a respectable PEG ratio of 1.0, while its competitors average 1.6Big Lots, (BIG) has been a safe haven for shoppers and investors in such a...
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5. (BIG) – Big Lots – maintains a respectable PEG ratio of 1.0, while its competitors average 1.6Big Lots, (BIG) has been a safe haven for shoppers and investors in such a...
6. (HWK) – Hawk Corporation – PEG ratio of only 0.39Hawk Corporation (HWK) recently set a new 52-week high after an excellent second-quarter earnings report....

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