Big Lots Inc. (BIG), the largest broad-line closeout retailer, recently posted healthy fourth-quarter comparable store sales for U.S. operations, exceeding the company’s guidance range.

Big Lots witnessed an increase of 3.4% in comparable store sales in the fourth quarter of 2011, above the company’s guidance range of 1% to 2% increase in comparable store sales.

During the period under review, Big Lots registered comparable-store sales growth across furniture, food and seasonal goods. Seasonal and furniture registered low double-digit growth, and consumables increased in the mid-single digits. Moreover, the company’s mix shift (shift to more electronics merchandise while trimming toys) was cheered by consumers.

Total retail sales from U.S. operations increased 7.7% year over year to $1,622.9 million during the reported period compared with $1,507.1 million in the prior-year period.

For the fifty-two week period, retail sales from U.S. operations increased 3.9% to $5,093.4 million compared with $4,900.6 million in the same period last year. Comparable store sales inched up 0.1% in fiscal 2011.

Guidance Goes Up

Buoyed by healthy holiday sales and lower-than-expected losses at its Canadian operations, the company raised its fourth-quarter 2011 earnings guidance range to $1.71 – $1.74 per share, representing an increase of 17% to 19% from the prior-year quarter. Earlier the company forecasted earnings in the range of $1.59 – $1.66.

For Fiscal 2011, Big Lots expects earnings in the range of $2.94 – $2.97 per share, representing an increase of 4% to 5% from the same period last year.

The Current Zacks Estimate for fourth-quarter of 2011 is $1.74 per share, while it is $2.97 for fiscal 2011.

The company stated that the sales results for the Canadian and Wholesale operations will be announced on Thursday, March 1, 2012 along with fourth quarter 2011 results.

Currently, we have a long-term Neutral rating on the stock. Moreover, Big Lots faces stiff competition from Target Corporation (TGT) and has a Zacks #3 Rank, which translates into a short-term Hold rating.

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