TJX Companies (TJX) AI Stock Analysis

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TJX Companies

(NYSE:TJX)

77Outperform

TJX Companies is in a strong financial position with robust revenue and profit growth, bolstered by effective cash flow management and sound operational efficiency. The positive earnings call further underpins the company's growth prospects, despite some concerns over profit margins and external challenges like foreign exchange rates. While the stock's valuation appears fair, the relatively high P/E ratio suggests it is priced for growth. The technical analysis supports a positive short-term trend, though the lack of momentum indicators warrants caution.

Positive Factors

Competitive Advantage

TJX is widening its moat through unique competitive advantages, likely supporting broadening outperformance and taking outsized market share.

Growth Opportunities

Home and International expansion represents unique growth opportunities for TJX.

Market Position

TJX is best-positioned in Off-Price to benefit from a surplus of inventory in the marketplace.

Negative Factors

Consumer Environment

A potentially weakening consumer environment will mean more consumers are likely to trade down to the off-price channel in search of value.

International Profitability

International remains less profitable than North America due to higher costs.

TJX Companies (TJX) vs. S&P 500 (SPY)

Market Cap

$143.42B

Dividend Yield1.17%

Average Volume (3M)6.19M

Price to Earnings (P/E)30.3

Beta (1Y)0.49

Revenue Growth3.95%

EPS Growth10.34%

CountryUS

Employees364,000

SectorConsumer Cyclical

Sector Strength58

IndustryApparel - Retail

Share Statistics

EPS (TTM)1.23

Shares Outstanding1,116,491,800

10 Day Avg. Volume4,675,678

30 Day Avg. Volume6,185,982

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.00

Price to Cash Flow (P/CF)0.00

P/FCF Ratio0.00

Enterprise Value/Market Cap1.04

Enterprise Value/RevenueN/A

Enterprise Value/Gross Profit8.67

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$140.25

Price Target Upside9.48% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering19

TJX Companies Business Overview & Revenue Model

Company DescriptionThe TJX Companies, Inc., together with its subsidiaries, operates as an off-price apparel and home fashions retailer. It operates through four segments: Marmaxx, HomeGoods, TJX Canada, and TJX International. The company sells family apparel, including footwear and accessories; home fashions, such as home basics, furniture, rugs, lighting products, giftware, soft home products, decorative accessories, tabletop, and cookware, as well as expanded pet, kids, and gourmet food departments; jewelry and accessories; and other merchandise. As of February 23, 2022, it operated 1,284 T.J. Maxx, 1,148 Marshalls, 850 HomeGoods, 59 Sierra, and 39 Homesense stores, as well as tjmaxx.com, marshalls.com, and sierra.com in the United States; 293 Winners, 147 HomeSense, and 106 Marshalls stores in Canada; 618 T.K. Maxx and 77 Homesense stores, as well as tkmaxx.com in Europe; and 68 T.K. Maxx stores in Australia. The company was incorporated in 1962 and is headquartered in Framingham, Massachusetts.

How the Company Makes MoneyTJX Companies makes money primarily through the sale of off-price apparel and home goods across its retail store brands. The company's revenue model is centered around purchasing excess inventory, closeouts, and overruns from manufacturers and other retailers at reduced prices, which it then sells in its stores at a lower price point than traditional retail outlets. Key revenue streams include sales from its physical stores and a growing e-commerce platform. Additionally, TJX benefits from strategic partnerships with suppliers and a flexible business model that allows it to quickly adapt to consumer demand and trends. The company's focus on cost management and efficient logistics also enhances its profitability by maintaining low operating expenses.

TJX Companies Key Performance Indicators (KPIs)

Any

Store Count by Type

Store Count by Type
Shows the number of stores under different formats, indicating the company's market reach and strategic focus on various retail experiences.

Chart InsightsTJX Companies is aggressively expanding its store footprint, with significant growth across all divisions, particularly in Marmaxx and HomeGoods. The latest earnings call underscores this momentum, highlighting plans to open 130 new stores in fiscal 2026. This expansion aligns with strong international sales growth and robust financial health, despite challenges like foreign exchange impacts and tariff concerns. The strategic focus on increasing market share and remodeling existing locations positions TJX well for continued growth, although profit margins may face short-term pressure due to rising costs.

Data provided by:

Main Street Data

TJX Companies Financial Statement Overview

Summary

TJX Companies demonstrates robust financial health with strong revenue and profit growth, efficient operations, and effective cash flow management. While leverage is moderate, the company maintains a solid return on equity. However, increasing the equity base could further strengthen the financial stability.

Income Statement

―

The income statement shows strong revenue growth with a healthy gross profit margin of 30.6% for 2025. The net profit margin stands at 8.6%, indicating effective cost management. The EBIT and EBITDA margins are robust at 11.2% and 13.1% respectively, showcasing operational efficiency. Revenue has grown consistently over the years, indicating positive business momentum.

Balance Sheet

The balance sheet reflects a moderate debt-to-equity ratio of 1.52, suggesting a balanced approach to leverage. The return on equity is strong at 57.9%, indicating effective use of shareholders' funds. The equity ratio is relatively low at 26.4%, which might suggest limited equity buffer. Overall, the financial position is solid but could be improved with a stronger equity base.

Cash Flow

―

The cash flow statement shows strong free cash flow generation with a growth rate of 41.1% from the previous year. The operating cash flow to net income ratio is 1.26, indicating good cash conversion from earnings. The free cash flow to net income ratio is 1.26, highlighting a strong ability to generate cash relative to profits. Overall, cash flow management is strong, supporting business operations and investments.

Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Breakdown
Income Statement		Total Revenue
56.36B	54.22B	49.94B	48.55B	32.14B
	Gross Profit
17.25B	16.27B	13.79B	13.84B	7.60B
	EBIT
6.30B	5.80B	5.08B	4.75B	582.23M
	EBITDA
7.66B	7.01B	5.96B	5.62B	1.15B
	Net Income Common Stockholders
4.86B	4.47B	3.50B	3.28B	90.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
5.33B	5.60B	5.48B	6.23B	10.47B
	Total Assets
31.75B	29.75B	28.35B	28.46B	30.81B
	Total Debt
12.78B	12.54B	12.74B	12.51B	15.50B
	Net Debt
7.44B	6.94B	7.27B	6.28B	5.03B
	Total Liabilities
23.36B	22.45B	21.98B	22.46B	24.98B
	Stockholders Equity
8.39B	7.30B	6.36B	6.00B	5.83B
Cash Flow		Free Cash Flow
4.20B	4.33B	2.63B	2.01B	3.99B
	Operating Cash Flow
6.12B	6.06B	4.08B	3.06B	4.56B
	Investing Cash Flow
-2.48B	-1.72B	-1.47B	-1.05B	-578.60M
	Financing Cash Flow
-3.84B	-4.21B	-3.31B	-6.20B	3.23B

TJX Companies Technical Analysis

Technical Analysis Sentiment

Positive

Last Price128.10

Price Trends

50DMA

122.96

Positive

100DMA

122.81

Positive

200DMA

119.57

Positive

Market Momentum

MACD

1.44

Positive

RSI

56.29

Neutral

STOCH

56.37

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TJX, the sentiment is Positive. The current price of 128.1 is above the 20-day moving average (MA) of 127.62, above the 50-day MA of 122.96, and above the 200-day MA of 119.57, indicating a bullish trend. The MACD of 1.44 indicates Positive momentum. The RSI at 56.29 is Neutral, neither overbought nor oversold. The STOCH value of 56.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TJX.

TJX Companies Risk Analysis

TJX Companies disclosed 28 risk factors in its most recent earnings report. TJX Companies reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

TJX Companies Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TJX	77 Outperform	$143.42B	30.27	61.98%	1.17%	3.95%	10.34%
URBN	76 Outperform	$4.80B	12.15	17.56%	―	7.71%	40.01%
GAP	73 Outperform	$8.53B	10.41	28.81%	2.67%	1.32%	65.83%
AEO	73 Outperform	$1.90B	6.62	18.80%	4.48%	1.27%	96.32%
ROST	73 Outperform	$46.57B	22.40	40.28%	1.05%	3.69%	13.71%
BURL	70 Outperform	$14.93B	30.42	42.55%	―	9.33%	50.05%
Sector *	61 Neutral	$6.59B	11.77	3.06%	3.98%	2.56%	-20.85%

* Consumer Cyclical Sector Average

Performance Comparison

TJX

TJX Companies

128.10

30.60

31.38%

AEO

American Eagle

11.14

-12.56

-53.00%

GAP

Gap Inc

22.66

0.56

2.53%

ROST

Ross Stores

142.28

10.20

7.72%

URBN

Urban Outfitters

51.82

10.60

25.72%

BURL

Burlington Stores

239.31

48.91

25.69%

TJX Companies Earnings Call Summary

Earnings Call Date:Feb 26, 2025

(Q4-2025)

% Change Since: 4.40%|

Next Earnings Date:May 21, 2025

Earnings Call Sentiment Positive

The earnings call highlighted a strong performance in the fourth quarter, marked by significant growth in international divisions, robust financial health, and successful store expansions. Despite some concerns about profit margin declines in the upcoming quarter and challenges with foreign exchange rates and tariffs, the company's overall trajectory appears positive with strategic initiatives and strong market positioning.

Q4-2025 Updates

Positive Updates

Outstanding Fourth Quarter Performance

Sales, profitability, and earnings per share were all well above expectations. Comp sales growth of 5% was driven by strong consistent increases of 4% or above at each division.

Record Store Openings

Opened the 5,000th store, with full-year sales surpassing $56 billion. The company plans to add about 130 net new stores in fiscal 2026.

International Success

International divisions showed strong performance, with TJX Canada's comp sales increasing 10% and TJX International's comp sales up 7%.

Strong Financial Health

Generated $6.1 billion in operating cash flow and ended the year with $5.3 billion in cash. Returned $4.1 billion to shareholders through buyback and dividend programs.

Segment Profit Margin Growth

Marmax's full-year segment profit margin increased to 14.1%, and HomeGoods' segment profits surpassed $1 billion with a margin return to double-digit levels at 10.9%.

Community Support Initiatives

Supported over 2,500 nonprofit organizations globally and provided relief efforts for natural disasters, including wildfires and hurricanes.

Negative Updates

First Quarter 2026 Profit Margin Decline

Expecting first-quarter pretax profit margin to be down 100 to 110 basis points versus last year's 11.1% due to unfavorable inventory hedges and increased wage and payroll costs.

Impact of Foreign Exchange Rates

Unfavorable foreign exchange rates expected to have a 1% negative impact on consolidated sales growth for fiscal 2026.

China Tariff Concerns

Ongoing challenges with the current China tariff environment, expected to have a small impact on future merchandise purchases.

Company Guidance

During The TJX Companies, Inc. Fourth Quarter Fiscal 2025 Financial Results Conference Call, CEO Ernie Herrman highlighted the company's exceptional performance, surpassing expectations in sales, profitability, and earnings per share. The company reported a 5% increase in fourth-quarter consolidated comp sales, driven by strong customer transactions, and achieved an overall comp sales growth of 4% for the full year, with total sales exceeding $56 billion. Pretax profit margins rose to 11.6% in the quarter, up 70 basis points from the previous year's adjusted figure, while full-year diluted earnings per share increased by 13% to $4.26. The company's divisions, including TJX Canada and TJX International, saw robust growth, with comp sales increasing by 10% and 7% respectively in the fourth quarter. Looking forward, TJX projects full-year fiscal 2026 consolidated sales to range between $58.1 billion and $58.6 billion, with comp store sales growth of 2% to 3%, despite accounting for a 1% negative impact from unfavorable foreign exchange rates. The company plans to open approximately 130 net new stores and remodel about 500 locations, highlighting a continued focus on expansion and market share growth.

TJX Companies Corporate Events

Executive/Board Changes

TJX Companies Extends Executive Employment Agreements

Neutral

Feb 3, 2025

On January 31, 2025, TJX Companies, Inc. announced the extension of employment agreements with key executives, including CEO Ernie Herrman and Executive Chairman Carol Meyrowitz, to January 2028 and with Executive Advisor Scott Goldenberg to April 2026. The agreements maintain existing terms and conditions, with Meyrowitz’s contract including a minimum annual salary adjustment, underscoring TJX’s commitment to its leadership stability and strategic continuity.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.