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Retail warehouse stores operator, PriceSmart, Inc. (PSMT - Snapshot Report), recently reported net sales and comparable sales figures for the month of May 2013.

May 2013 Results

Net sales grew 14.8% to $187.5 million for the month and 11.4% to $1.67 billion for the nine months ended May 31, 2013.

Further, PriceSmart reported 9.8% year-over-year increase in comparable warehouse sales for 29 warehouse clubs for the five weeks ended Jun 2, 2013. Comps were better than 9.6%, 7.9% and 8.9% reported in the months of April, March and February, respectively; thus showing improving trends. Comps are however, still below its past trend of double-digit growth.

PriceSmart is involved in the operation of membership shopping warehouses in international markets. It had 31 warehouse clubs in operation at the end of May 2013. In the beginning of this year, PriceSmart bought more than 20,000 square meters of land in the southern Tegucigalpa, Honduras, where it plans to open another Membership Warehouse Club. This Club, which is scheduled to be opened in 2014, would be its third in the Honduras.

The company sells good-quality basic consumer products at affordable prices. PriceSmart has been reaping the benefits of a shift in consumer preference. Consumers are shifting toward lower-priced brands and private-label merchandise sold by the company due to slow economic recovery, low employment level and reduced consumer spending. This business model helps PriceSmart to consistently generate strong sales, earn profits and offset low margins.

Other Stocks to Consider

PriceSmart carries a Zacks Rank #4 (Sell). Other stocks in the retail/discount industry that are worth considering include The TJX Companies, Inc. (TJX - Analyst Report) and Fred's, Inc. (FRED - Analyst Report), both carrying a Zacks Rank #2 (Buy). In the broader consumer staples sector, Flower Foods, Inc (FLO - Snapshot Report) carries a Zacks Rank #1 (Strong Buy)

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