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TJX (TJX) Up 4% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for TJX (TJX - Free Report) . Shares have added about 4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is TJX due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.
The TJX Companies posted first-quarter fiscal 2027 results, wherein the top and bottom lines beat the Zacks Consensus Estimate. Both metrics also increased from the year-ago quarter. The company raised its fiscal 2027 guidance.
The TJX Companies’ fiscal first-quarter earnings per share (EPS) were $1.19, up 29% from the year-ago quarter. The metric also beat the Zacks Consensus Estimate of $1.01 per share.
Net sales came in at $14,323 million, registering an increase of 9% year over year and surpassing the Zacks Consensus Estimate of $13,998 million.
In the Marmaxx (the United States) division, the company’s net sales were $8,650 million, up 7% year over year. Net sales amounted to $2,506 million, up 11% year over year, in the HomeGoods (the United States) division. TJX Canada’s net sales were $1,285 million, up 12% from the figure reported in the year-ago period. TJX International’s (Europe & Australia) net sales were $1,882 million, up 13% year over year.
The company witnessed a 6% jump in consolidated comparable store sales, supported by strong performance in every division. Comparable store sales rose 6% at Marmaxx (the United States), 9% at HomeGoods (the United States), 7% at TJX Canada and 4% at TJX International (Europe & Australia).
The TJX Companies’ pretax profit margin was 12%, up 1.7 percentage points from the year-ago quarter’s level. The increase is driven by expense leverage from stronger-than-planned sales, favorable fuel hedges and better-than-anticipated merchandise margins.
The gross profit margin was 31.3%, up 1.8 percentage points year over year, mainly driven by higher merchandise margins, favorable inventory and fuel hedge impacts, and expense leverage from stronger sales performance.
The company’s selling, general and administrative costs, as a percent of sales, were 19.5%, a 0.1 percentage point increase.
TJX’s Financial Health Snapshot
During the first-quarter fiscal 2027, the company increased its total store count by 48, reaching 5,262.
The TJX Companies ended the quarter with cash and cash equivalents of $5,580 million, long-term debt of $1,871 million and shareholders’ equity of $10,403 million. It generated an operating cash flow of $1,119 million in the first quarter of fiscal 2027.
In the fiscal first quarter, the company returned $1.1 billion to shareholders, including $604 million used to repurchase 3.8 million shares and $471 million paid in shareholder dividends. The company also increased its fiscal 2027 share repurchase plan to be between $2.75 billion and $3 billion.
What to Expect From TJX Moving Forward?
For fiscal 2027, The TJX Companies now expects consolidated comparable store sales growth of 3% to 4%, up from the previously estimated 2% to 3% rise. The company also raised its pretax profit margin outlook to 11.9% to 12% compared with the prior range of 11.7% to 11.8%, and now anticipates earnings per share of $5.08 to $5.15, above the earlier forecast of $4.93 to $5.02.
For the second quarter of fiscal 2027, management expects consolidated comparable store sales to grow 2% to 3%. The company projects a pretax profit margin between 11.4% and 11.5%. The quarterly EPS is expected in the range of $1.15 to $1.17.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
At this time, TJX has a great Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. However, the stock was allocated a score of D on the value side, putting it in the bottom 40% for value investors.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, TJX has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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TJX (TJX) Up 4% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for TJX (TJX - Free Report) . Shares have added about 4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is TJX due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.
TJX Q1 Earnings and Sales Beat Estimates, Fiscal 2027 Guidance Raised
The TJX Companies posted first-quarter fiscal 2027 results, wherein the top and bottom lines beat the Zacks Consensus Estimate. Both metrics also increased from the year-ago quarter. The company raised its fiscal 2027 guidance.
The TJX Companies’ fiscal first-quarter earnings per share (EPS) were $1.19, up 29% from the year-ago quarter. The metric also beat the Zacks Consensus Estimate of $1.01 per share.
Net sales came in at $14,323 million, registering an increase of 9% year over year and surpassing the Zacks Consensus Estimate of $13,998 million.
In the Marmaxx (the United States) division, the company’s net sales were $8,650 million, up 7% year over year. Net sales amounted to $2,506 million, up 11% year over year, in the HomeGoods (the United States) division. TJX Canada’s net sales were $1,285 million, up 12% from the figure reported in the year-ago period. TJX International’s (Europe & Australia) net sales were $1,882 million, up 13% year over year.
The company witnessed a 6% jump in consolidated comparable store sales, supported by strong performance in every division. Comparable store sales rose 6% at Marmaxx (the United States), 9% at HomeGoods (the United States), 7% at TJX Canada and 4% at TJX International (Europe & Australia).
The TJX Companies’ pretax profit margin was 12%, up 1.7 percentage points from the year-ago quarter’s level. The increase is driven by expense leverage from stronger-than-planned sales, favorable fuel hedges and better-than-anticipated merchandise margins.
The gross profit margin was 31.3%, up 1.8 percentage points year over year, mainly driven by higher merchandise margins, favorable inventory and fuel hedge impacts, and expense leverage from stronger sales performance.
The company’s selling, general and administrative costs, as a percent of sales, were 19.5%, a 0.1 percentage point increase.
TJX’s Financial Health Snapshot
During the first-quarter fiscal 2027, the company increased its total store count by 48, reaching 5,262.
The TJX Companies ended the quarter with cash and cash equivalents of $5,580 million, long-term debt of $1,871 million and shareholders’ equity of $10,403 million. It generated an operating cash flow of $1,119 million in the first quarter of fiscal 2027.
In the fiscal first quarter, the company returned $1.1 billion to shareholders, including $604 million used to repurchase 3.8 million shares and $471 million paid in shareholder dividends. The company also increased its fiscal 2027 share repurchase plan to be between $2.75 billion and $3 billion.
What to Expect From TJX Moving Forward?
For fiscal 2027, The TJX Companies now expects consolidated comparable store sales growth of 3% to 4%, up from the previously estimated 2% to 3% rise. The company also raised its pretax profit margin outlook to 11.9% to 12% compared with the prior range of 11.7% to 11.8%, and now anticipates earnings per share of $5.08 to $5.15, above the earlier forecast of $4.93 to $5.02.
For the second quarter of fiscal 2027, management expects consolidated comparable store sales to grow 2% to 3%. The company projects a pretax profit margin between 11.4% and 11.5%. The quarterly EPS is expected in the range of $1.15 to $1.17.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
At this time, TJX has a great Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. However, the stock was allocated a score of D on the value side, putting it in the bottom 40% for value investors.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, TJX has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.