Thanksgiving is tomorrow, but Christmas lights are already starting to wink at holiday shoppers. With some major discount retailers elivering impressive third-quarter results over the past two weeks, expectations are high they will continue to rack up gains over the holiday season.

TJX (NYSE:TJX), for example, which sells name-brand apparel and other merchandise at lowball prices through such chains as T.J. Maxx and Marshall's, posted a 29% jump in quarterly earnings per share and 11% sales growth over the same period last year. Looking ahead, the company said it expects "significant year-over-year earnings per share growth" in the fourth quarter, with analysts calling for 42 cents a share compared to 29 cents a year ago. Wall Street's consensus is $1.23 a share for the current year, up almost 14% from $1.08 the year before.

The bottom line: Off-price retailing has come of age, and TJX stands to be a big winner. The company is pressing ahead with expansion plans to satisfy the needs of consumers' surging demand for discounts. While specialty stores like Gap (NYSE:GPS) are trimming their square footage, TJX said it's on track to expand square footage by 10% this year. Its A.J. Wright stores on the East Coast posted a 56% sales increase for the third quarter and sales for those stores open at least a year, a key indicator, rose an enviable 14%.

The A.J. Wright chain, launched only four years ago, now numbers 89 stores and the company is looking to expand to over 1,000 stores nationwide. Last year, TJX grew its store base by 11% to 1,843 stores worldwide and a few weeks ago announced plans for a $100 million purchase of 36 Bob's Stores, a value-oriented retail chain in the Northeast. The significant excess cash generated by operations enables the company to internally fund this growth, together with a nearly $400 million stock buyback program so far this year, while it also pays out dividends to shareholders.

To keep prices low, a discount retailer must control costs. As the largest off-price retailer in the country, TJX pulls a lot of weight with its suppliers. Its buyers negotiate deals with about 9,000 vendors. The T.J. Maxx chain has its own distribution and sourcing network, permitting it to expand nationally, and goods are made just for off-price retailers so that inventories can stay consistent.

TJX seems to be hitting on all cylinders, but stockholders may need to be patient. When quarterly results were announced, shares dropped 2% and they have continued trading in the $22 range. The long-term positive outlook may already be factored into the price.

The stock may not be at a rock-bottom price, but for you buy-to-hold investors, this might be a company worth stuffing in your Christmas stocking.

Carla Pasternak welcomes feedback at cpasternak@mtroyal.ca.