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Will Robust Comps Fuel TJX Companies' (TJX) Q3 Earnings?
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The TJX Companies, Inc. (TJX - Free Report) is on track to release third-quarter fiscal 2019 results on Nov 20. This off-price retailer delivered a positive earnings surprise of 11.4% in the last reported quarter and outperformed the Zacks Consensus Estimate by an average of 7.3% in the trailing four quarters. Moreover, the company has been delivering year-over-year growth in earnings and sales for quite some time, courtesy of robust efforts to draw traffic.
That said, let’s see if the company can sustain splendid past record in the upcoming quarterly results.
Strong Comps Keep Things Cheerful
TJX Companies has been delivering impressive comps run for a while. During the second quarter of fiscal 2019, consolidated comps grew 6% year over year on increased consumer traffic in all the segments, especially the Marmaxx division. Notably, the second quarter marked the 16th straight period of higher customer traffic for Marmaxx and the company as a whole. In fact, all segments reported higher comps. Comps rose 3%, 6%, 4% and 7% at the HomeGoods, TJX Canada, TJX International and Marmaxx segments, respectively.
Consumers’ favorable response toward the company’s brands and impressive merchandise assortments at reasonable prices are fueling comps. The company is well placed to benefit from solid opportunities in the market for branded merchandise, considering impressive inventory and liquidity position. Successful implementation of off-price fundamentals is also boosting footfall. Markedly, the company’s apparel business is performing exceptionally. In fact, such upsides keep management encouraged about witnessing consistent market share gains.
The company stated that it commenced the third quarter on a strong note, which along with stellar second-quarter performance fueled comps projection for the impending quarter. Management expects consolidated comps growth of 2-3% for third-quarter fiscal 2019. The Marmaxx division is expected to post comps growth of 3-4%.
Store Expansion & Strategies to Boost Sales
TJX Companies boasts an aggressive store-opening strategy. The company regularly opens stores and is expanding rapidly across the United States, Europe and Canada. During the second quarter, the company added around 53 stores.
Further, with increasing number of consumers resorting to online shopping, TJX Companies has undertaken several initiatives to strengthen e-commerce business. Effective marketing initiatives have been aiding the company’s performance. Its gift-giving initiatives, unique among off-price retailers and loyalty card program, help to improve customer engagement.
The TJX Companies, Inc. Price, Consensus and EPS Surprise
TJX Companies’ off-price model as well as strategic store locations and impressive brands have been driving performance, in stores and online. We expect such dedicated endeavors to maintain position will cushion the hurdles surrounding rising wage costs and adverse currency movement.
Moreover, the impressive past performance led management to provide an encouraging view for the third quarter when it reported second-quarter results. The company expects adjusted earnings in the range of $1.00-$1.02 per share, reflecting a rise from $1.00 (on pre-stock-split basis) in the year-ago quarter. Including benefits from tax reforms, earnings are expected in the range of $1.18-$1.20 per share. We note that on Sep 17, the company announced a 2-for-1 stock split.
The Zacks Consensus Estimate for earnings is currently pegged at 61 cents per share. The estimate has been stable in the past 30 days. The consensus mark for sales is pegged at $9,498 million, depicting a rise of 8.4% from the prior-year quarter’s tally.
What Does the Zacks Model Unveil?
To top it, our proven model shows that TJX Companies is likely to beat bottom-line estimates this quarter. For this to happen, a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Here are a few other companies you may want to consider as our model shows that they also have the right combination of elements to post an earnings beat:
Burlington Stores, Inc. (BURL - Free Report) has an Earnings ESP of +2.38% and a Zacks Rank #2.
Ross Stores, Inc. (ROST - Free Report) has an Earnings ESP of +2.70% and a Zacks Rank #2.
Zumiez Inc. (ZUMZ - Free Report) has an Earnings ESP of +0.62% and a Zacks Rank #3.
3 Medical Stocks to Buy Now
The greatest discovery in this century of biology is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating revenue, and cures for a variety of deadly diseases are in the pipeline.
So are big potential profits for early investors. Zacks has released an updated Special Report that explains this breakthrough and names the best 3 stocks to ride it.
Image: Bigstock
Will Robust Comps Fuel TJX Companies' (TJX) Q3 Earnings?
The TJX Companies, Inc. (TJX - Free Report) is on track to release third-quarter fiscal 2019 results on Nov 20. This off-price retailer delivered a positive earnings surprise of 11.4% in the last reported quarter and outperformed the Zacks Consensus Estimate by an average of 7.3% in the trailing four quarters. Moreover, the company has been delivering year-over-year growth in earnings and sales for quite some time, courtesy of robust efforts to draw traffic.
That said, let’s see if the company can sustain splendid past record in the upcoming quarterly results.
Strong Comps Keep Things Cheerful
TJX Companies has been delivering impressive comps run for a while. During the second quarter of fiscal 2019, consolidated comps grew 6% year over year on increased consumer traffic in all the segments, especially the Marmaxx division. Notably, the second quarter marked the 16th straight period of higher customer traffic for Marmaxx and the company as a whole. In fact, all segments reported higher comps. Comps rose 3%, 6%, 4% and 7% at the HomeGoods, TJX Canada, TJX International and Marmaxx segments, respectively.
Consumers’ favorable response toward the company’s brands and impressive merchandise assortments at reasonable prices are fueling comps. The company is well placed to benefit from solid opportunities in the market for branded merchandise, considering impressive inventory and liquidity position. Successful implementation of off-price fundamentals is also boosting footfall. Markedly, the company’s apparel business is performing exceptionally. In fact, such upsides keep management encouraged about witnessing consistent market share gains.
The company stated that it commenced the third quarter on a strong note, which along with stellar second-quarter performance fueled comps projection for the impending quarter. Management expects consolidated comps growth of 2-3% for third-quarter fiscal 2019. The Marmaxx division is expected to post comps growth of 3-4%.
Store Expansion & Strategies to Boost Sales
TJX Companies boasts an aggressive store-opening strategy. The company regularly opens stores and is expanding rapidly across the United States, Europe and Canada. During the second quarter, the company added around 53 stores.
Further, with increasing number of consumers resorting to online shopping, TJX Companies has undertaken several initiatives to strengthen e-commerce business. Effective marketing initiatives have been aiding the company’s performance. Its gift-giving initiatives, unique among off-price retailers and loyalty card program, help to improve customer engagement.
The TJX Companies, Inc. Price, Consensus and EPS Surprise
The TJX Companies, Inc. Price, Consensus and EPS Surprise | The TJX Companies, Inc. Quote
Estimates Indicate Growth Prospects
TJX Companies’ off-price model as well as strategic store locations and impressive brands have been driving performance, in stores and online. We expect such dedicated endeavors to maintain position will cushion the hurdles surrounding rising wage costs and adverse currency movement.
Moreover, the impressive past performance led management to provide an encouraging view for the third quarter when it reported second-quarter results. The company expects adjusted earnings in the range of $1.00-$1.02 per share, reflecting a rise from $1.00 (on pre-stock-split basis) in the year-ago quarter. Including benefits from tax reforms, earnings are expected in the range of $1.18-$1.20 per share. We note that on Sep 17, the company announced a 2-for-1 stock split.
The Zacks Consensus Estimate for earnings is currently pegged at 61 cents per share. The estimate has been stable in the past 30 days. The consensus mark for sales is pegged at $9,498 million, depicting a rise of 8.4% from the prior-year quarter’s tally.
What Does the Zacks Model Unveil?
To top it, our proven model shows that TJX Companies is likely to beat bottom-line estimates this quarter. For this to happen, a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
TJX Companies’ Zacks Rank #2, combined with an Earnings ESP of +0.89%, makes us reasonably confident of an earnings beat. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other Stocks Poised to Beat Earnings Estimates
Here are a few other companies you may want to consider as our model shows that they also have the right combination of elements to post an earnings beat:
Burlington Stores, Inc. (BURL - Free Report) has an Earnings ESP of +2.38% and a Zacks Rank #2.
Ross Stores, Inc. (ROST - Free Report) has an Earnings ESP of +2.70% and a Zacks Rank #2.
Zumiez Inc. (ZUMZ - Free Report) has an Earnings ESP of +0.62% and a Zacks Rank #3.
3 Medical Stocks to Buy Now
The greatest discovery in this century of biology is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating revenue, and cures for a variety of deadly diseases are in the pipeline.
So are big potential profits for early investors. Zacks has released an updated Special Report that explains this breakthrough and names the best 3 stocks to ride it.
See them today for free >>