Key Highlights
- First quarter revenue reached $14.32B, reflecting 9.2% year-over-year growth and exceeding projections by $310M
- Adjusted earnings per share of $1.19 surpassed analyst expectations by $0.19, marking a 29% annual increase
- HomeGoods division delivered remarkable performance with comparable sales jumping over 100% versus prior year
- Company elevates full-year earnings outlook to $5.08–$5.15 range; quarterly dividend increased 13% to $0.48
- Second quarter forecast disappoints with EPS projection of $1.15–$1.17 falling short of $1.19 analyst consensus
Shares of TJX Companies (TJX) surged over 4% during Wednesday’s premarket session following the release of impressive first quarter results that exceeded Wall Street’s projections on multiple fronts.
The shares kicked off trading at $150.87, positioning the stock to extend its winning streak to five consecutive trading sessions.
First quarter sales totaled $14.32 billion, representing a 9.2% year-over-year increase and landing $310 million above analyst forecasts. The company’s adjusted earnings per share of $1.19 exceeded both Street expectations and internal projections by $0.19, marking a substantial 29% improvement compared to the same period last year.
Chief Executive Ernie Herrman highlighted the exceptional performance. “Sales, pretax profit margin, and earnings per share were all well above our plan,” he noted.
The HomeGoods segment emerged as the star performer. Comparable store sales in this division surged more than 100% compared to the prior year period. Company-wide comparable store sales climbed 6%, a significant acceleration from last year’s 3% growth and surpassing the 3.95% consensus forecast.
The company’s Canadian operations also delivered impressive double-digit sales increases, underscoring the widespread momentum throughout the organization.
Company Raises Full-Year Forecast
Capitalizing on the strong first quarter performance, TJX elevated its full-year earnings per share forecast to a range of $5.08–$5.15, up from the previous guidance of $4.93–$5.02. The updated midpoint of $5.12 aligns with Wall Street’s consensus projection.
The retailer also improved its full-year comparable store sales guidance, now anticipating growth of 3%–4% compared to the earlier 2%–3% range. The pretax profit margin forecast was lifted to 11.9%–12.0%.
Additionally, TJX boosted its quarterly dividend payment by 13%, increasing it from $0.43 to $0.48 per share, which translates to an annual distribution of $1.92 per share — representing approximately a 1.3% dividend yield.
Second Quarter Guidance Disappoints
However, not all news was positive. The company’s second quarter outlook came in below expectations.
TJX projects Q2 comparable store sales growth of 2%–3%, trailing the 3.42% analyst estimate. The earnings per share guidance range of $1.15–$1.17 also falls short of the $1.19 consensus forecast. The pretax profit margin outlook of 11.4%–11.5% similarly misses the 11.6% expectation.
Despite the conservative near-term guidance, investor enthusiasm remained robust, with shares continuing their upward trajectory before the opening bell.
Competing retailers benefited as well. Shares of Ross Stores (ROST) and Burlington (BURL) both climbed in sympathy with TJX’s strong showing.
Wall Street analysts had already expressed confidence ahead of the earnings release. JPMorgan increased its price objective to $174 prior to the announcement while maintaining an overweight rating. Truist launched coverage with a buy recommendation and a $175 price target. Barclays maintains an overweight stance with a $183 target.
Among analysts monitored by MarketBeat, three assign TJX a strong buy rating while twenty-two recommend it as a buy. The consensus price target stands at $169.25.
Institutional ownership accounts for 91.09% of outstanding shares. Recent insider transaction activity included CEO Herrman divesting 30,000 shares on March 2nd at an average price of $160.95.
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