The retail sector has done well despite rising inflation and constraints in supply chains. This is due to consumer discretionary spending. And we believe popular retail companies TJX Companies (NYSE:) and Bed Bath & Beyond (BBBY) should benefit because the demand for retail goods is expected to remain strong ahead of the holiday season. What stock do you think is the best buy? Read more to find out.Framingham, Mass.-based TJX Companies, Inc. (TJX) and Bed Bath & Beyond Inc. (BBBY), which is headquartered in Union, N.J., are two prominent players in the retail industry. TJX is an off-price clothing and home fashions retailer. It sells fine jewelry, family apparel, accessories and other merchandise around the world. It operates through four segments—Marmaxx; HomeGoods; TJX Canada; and TJX International. BBBY manages several retail outlets that sell domestic merchandise, furniture, accessories, as well as various other products for children around the world. Decorist is an online design service that allows you to personalize your home.

Despite the recent resurgence of COVID-19 cases, rising inflation, and supply chain disruptions, retail sales rose for two straight months—0.9% in August and 0.7% in September. An expected increase in consumer spending ahead of the holiday season, supported by an improving job market, should further drive the industry’s growth. Due to increasing foot traffic in brick-and-mortar shops ahead of the holiday season, The National Retail Federation expects holiday sales growth between 8.5% and 10.5% over November-December. Global retail sales are expected to increase 7.2% by 2021. Both TJX and BBBY should be able to benefit.

TJX has risen 2.3% while BBBY is down 60.3% during the past nine month. TJX is a clear winner with 26.6% gains versus BBBY’s negative returns in terms of the past year’s performance. What stock do you think is the best? Let’s find out.

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