Target Capitalizes on Recession

There appears to be at least one growth industry in the economic downturn: discount retailing.

Target (TGT) plans to open 27 new stores in the continental US and Hawaii that will employ about 4,300 people. The move comes just weeks after the retailer said it would cut about 600 jobs, citing weaker-than-expected sales.

Other discounters also plan to expand during the recession.

Kohl’s (KSS), operator of about 1,000 stores in 48 states mainly in the Midwest, plans to open 55 stores.

Privately-held Dollar General, operator of about 8,200 stores in the South, Midwest and Southwest, plans to open about 400 new stores.

Wal-Mart (WMT), the world’s largest retailer, has ridden tough times to strong sales. The company said February’s same-store sales, or sales at stores open a year or more, rose 5.1%, beating analysts’ consensus estimate for a 2.4% increase. The sales figures exclude gasoline.

Costco (COST), the nation’s largest operator of membership warehouse stores, said February same-store sales increased 4%. Sales at Wal-Mart’s Sam’s club, the number 2 chain in the sector, were up 5.9%. Sales at BJ’s Wholesale Club (BJ), which is number 3 in the sector, rose 8.2%.

The common theme – bargains – is likely to continue for the foreseeable future.