While Sainsbury’s (LSE: SBRY) has struggled in recent years to come to terms with challenging trading conditions, its long-term future remains very bright. Part of the reason for this is an improving UK economy, with consumer spending on the up thanks to wage growth being ahead of inflation. This should help mid-tier operators such as Sainsbury’s, since price could become a less important factor for consumers versus convenience, quality and customer service.

Furthermore, Sainsbury’s has the scope to rapidly increase its profitability through the proposed acquisition of Home Retail (LSE: HOME). If this happens, it would lead to major cross-selling opportunities, with Sainsbury’s planning to have Argos concessions within its stores. Although the synergies from the deal may take a number of years to come through, it could prove to be a game-changer for Sainsbury’s.

With it trading on a price-to-earnings (P/E) ratio of 12.4, Sainsbury’s appears to be fairly priced at the moment. And with its growth prospects being more upbeat than many investors currently realise, its shares could deliver exceptional capital gains over the medium-to-long term.

Back in fashion

Also set to benefit from an improving UK economy is Debenhams (LSE: DEB). Like Sainsbury’s its customers have traded down to cheaper alternatives in recent years. But with consumer confidence on the rise and interest rates set to remain low over the medium term, Debenhams is set to build on its recent return to profit growth.

This growth may be higher than the market is currently pricing-in since Debenhams trades on a P/E ratio of just 10.1. This seems to be rather low given its bright future. With the company focused on selling fewer products but at higher prices, its margins have the potential to expand moving forward. And with a sound balance sheet and exposure to non-UK markets, Debenhams could expand its store footprint and also benefit from a weaker sterling.

Furthermore, with dividends due to rise by 5% next year, Debenhams’ management seems to be optimistic regarding its future growth prospects. This could act as a positive catalyst on its future share price performance.

Shares set to rise?

Meanwhile, online takeaway ordering company Just Eat (LSE: JE) continues to offer stunning growth prospects. For example, its bottom line is expected to rise by 47% in each of the next two years and with the company having expansion potential via M&A activity, it seems likely to deliver further double-digit growth in the coming years. That’s especially the case since Just Eat has the capacity to expand into new territories as well as grow its business and market share within existing regions.

Despite this huge potential, Just Eat trades on a price-to-earnings-growth (PEG) ratio of just 0.8. This indicates that its shares could move much higher and still offer good value for money. For example, were they to instantly rise by 20%, they would still trade on a highly appealing PEG ratio of just over 1. As such, it appears as though the market isn’t pricing-in the full extent of Just Eat’s growth, which creates an opportunity for capital gains.

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Peter Stephens owns shares of Debenhams and Sainsbury (J). The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.