BUY OR SELL: U.S. retail stocks don't sink after June sales

By Jessica Wohl

CHICAGO (Reuters) - Retailers with a value message showed signs of strength on Thursday even though overall June sales were a bit of a disappointment.

Sales at stores open at least a year, or same-store sales, fell 4.9 percent in June according to the Thomson Reuters index. But a handful of companies posted stronger sales, including TJX Cos Inc, which runs discount-oriented chains such as T.J. Maxx.

The Standard & Poor's retail index is already up 11 percent this year and rose less than 1 percent on Thursday, while the S&P 500 has fallen nearly 3 percent in 2009.

Have investors made all of the money they can betting on retail's rebound following a rough 2008? Is there more room for growth?

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"I would say look at value, look at consumables and those are really the two major themes," said Sarah Henry, a retail analyst at MFC Global Investment Management. "I think there's some more opportunity there left this year."

"There are clear market share beneficiaries, the big one this morning, by far, was T.J. Maxx, you can see how powerful it is. And of course yesterday we saw Family Dollar really performing very well in this environment," Henry said.

Retailers with better balance sheets and cash flow have been able to squeeze some concessions on costs from vendors, a move mentioned by Family Dollar and alluded to by Target Corp, she said.