TJX Companies (TJX) knows there is big money to be made in discounting. The retailer owns the two largest off-price-clothing stores in the country -- T.J. Maxx and Marshalls.

With more than 1,860 stores in the United States, Canada and Europe, TJX pulled in more than $13 billion in sales last year and should be able to boost that figure by 12% this year, says Value Line. In December, the company broadened its reach further by acquiring Bob's Stores, a Northeastern value retail chain. The purchase should help drive sales growth over the long-term.

TJX is a favorite of Kent Simons and Bob Corman, managers of Neuberger Berman Focus fund (NBSSX). The retailer, says Simons, "is a money machine." It generates substantial free cash flow (cash left after capital expenditures needed to maintain the businesses), repurchases $500 million of its own shares yearly and has seen earnings grow 40% per year compounded over the past five years.

The stock, at $24, trades at 17 times the 2004 consensus profit estimate of $1.42 per share.

--Brian Knestout

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