I grew up in the Boston area, but haven't lived there full-time in about 10 years. Listening to the BJ'sWholesale Club (NYSE:BJ) conference call and hearing so many Boston accents is a real treat.

For years, BJ's has been considered an also-ran to Motley Fool Stock Advisor pick Costco (NASDAQ:COST) and the Sam's Clubs operated by Wal-Mart (NYSE:WMT). However, the company has strung together a nice performance lately. Underestimating BJ's as an investment at this time may be a mistake.

BJ's first-quarter results were very impressive. Sales were up 9.8% and diluted earnings per share jumped a robust 19.8%. On the balance sheet, the company carries $93 million in cash and only $3 million in long-term debt.

One question stuck in my mind: Why had the company only added eight stores in the last year? I'm no fan of companies that overcommit to expansion plans, but eight stores seemed a bit low. With all the cash on the balance sheet, and solid earnings and cash flows, it looked to me like BJ's could expand a little faster.

On the conference call, the company addressed this concern very clearly. For the last couple of years, BJ's has worked on stabilizing and repositioning its business with a greater focus on individual customers and a broader product offering. With the strategic changes largely implemented and results improving, the company is now ready to begin slowly ramping up its expansion efforts in or adjacent to regions where it already operates.

The trailing P/E of 17 closely matches BJ's owner earnings, which I'm calculating as net income, minus depreciation, plus capital expenditures, then plus or minus one-time items such as the company's recovery of bankruptcy claims at House2Home. Digging a bit deeper and stripping out the expansion-related capital expenditures shows that the existing business has pretty strong cash dynamics.

While BJ's is a bit too large to be considered as a Hidden Gem, I'm curious enough about the company to want to explore its details a bit further. First, I'll be looking much more closely at the company's cash and inventory dynamics, because at $29 per share, the company offers an attractive value on the surface.

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Nathan Parmelee owns shares in Costco, but has no financial interest in any of the other companies mentioned. The Fool has a disclosure policy.