This TJX Number Confirms Our Portfolio Positioning
Here's what we’re focusing on in the company’s earnings call.
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Shares of Pro Portfolio holding TJX Companies (TJX) are rising Wednesday morning in response to the company’s October-quarter earnings report.
Results included a 5% comp sales figure, a step up from the 4% figure posted in the prior quarter, and well ahead of management’s 2%-3% guidance for the quarter. Comparing that accelerated comp sales pace against the October-quarter comp sales figure of 2.7% from Target (TGT) and 0.4% from Lowe’s (LOW) also out Wednesday morning, as well as other recent ones, confirms TJX’s positioning as consumers look to stretch their disposable spending dollars. The same line of reasoning supports our bullish stance on Costco (COST) , given its string of impressive monthly comp sales figures.
As we digest TJX's earnings call this morning, which kicks off at 11 AM ET, we’ll aim to revisit our $150 price target. Part of that will be determining the degree to which management’s guidance for the current quarter, which targets comp sales of 2-3% and EPS of $1.33-$1.36 vs. the $1.37 consensus, is conservative. The same goes for its guided pretax profit margin of 11.7%-11.8% compared to the 12.7% posted in the October quarter and the 11.6% posted in the January 2025 one.
A Quick Review of TJX’s October Quarter
TJX reported October-quarter EPS of $1.28, $0.05 better than the market consensus, on revenue that climbed 7.5% year over year to $15.12 billion, nicely ahead of the $14.85 billion market forecast. As we noted above, comp sales for the quarter rose 5% and across its brands. Those figures were as follows:
Marmaxx US +6% (60% of October quarter sales)
HomeGoods US +5% (17%)
TJX Canada +8% (10%)
TJX Intl +3% (13%)
In terms of management’s updated outlook, it now sees fiscal 2026 comp sales up 4% compared to its 3% guidance in August, and EPS for the fiscal year between $4.63-$4.66, up from its prior forecast of $4.52-$4.57. As a reminder, the company’s fiscal 2026 ends with the January 2026 quarter.
During the first nine months of the current fiscal year, TJX repurchased $1.7 billion in stock, roughly 13.4 million shares, and now targets repurchasing ~$2.5 billion during fiscal 2026.
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At the time of publication, TheStreet Pro Portfolio was long TJX and COST.
