It's as though nothing can stop The Buckle (NYSE: BKE). The retailer has been on a tear throughout the recession, posting double-digit revenue and comps while rivals faced plummeting sales.

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Resisting The Recession
Once again, The Buckle's third-quarter results proved to be an anomaly in the retail sector. Sales grew 9.8% to $231.2 million and same-store sales rose 4.3%. The bottom line improved 14.4% to 71 cents per share. And most importantly, the gross margin widened 70 basis points over last year, indicating no promotional activity was used to generate growth.

I want to highlight The Buckle's margin expansion given that most peers are experiencing margin erosion. The Buckle utilizes a distribution system that delivers inventory daily. Not only does this keep the merchandise layout fresh, but it allows variation in the merchandise mix at each specific location.

The Buckle essentially tailors its inventory to reflect the buying patterns at various locations. While this results in incremental distribution costs, the added expenses are offset by the lack of markdowns necessary and the ability to appropriately manage inventory. Inventory for the quarter was just about flat compared to last year.

All In The Family
I think the family roots still lingering in The Buckle's board room have played a role in the retailer's success. The founder's son is still chairman, and 44% of the company is owned by insiders. The seasoned management team consists of executives who all have more than 20 years of experience with the company.

The strong relationships and loyalty built within the corporation, along with a deep understanding of the business, have resulted in steady and ongoing growth with mitigated risk. Rather than chasing after quick profits in high profile yet costly locations, The Buckle has focused its expansion in more regional locations. It is most popular in Midwestern states.

Robust And Unique Business Model
I also like that The Buckle's business model is built on a dual merchandising strategy, combining lower price point in-house items with high price point brand name items. This allows shoppers to pair cheaper private-label merchandise with their favorite brand name clothes - a key factor in the company's superior margins.

The Buckle operates a phenomenal business model and is a retailer we'll see standing tall regardless of how long this recession lingers. With superior customer service and an ever-changing merchandise layout, the stores give shoppers a reason to pay full price for their products. And that's something not many other retailers have been able to figure out.

Bottom Line
The debt-free retailer is selling at just 11 times next year's earnings - a bargain given that ailing Abercrombie & Fitch (NYSE: ANF) is selling at 22 times next year's earnings. And competitors Zumiez (Nasdaq: ZUMZ) and Urban Outfitters (Nasdaq: URBN) are selling at 26 and 21 times forward earnings, respectively.

While The Buckle is not a growth play, the company has a proven track record of solid, steady growth over the years and makes a great core retail holding. (To learn more, see Analyzing Retail Stocks.)

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