TJX Companies (TJX:NYSE) $138.27

Gain to date: 12%

We urged readers to run the rule over TJX Companies (TJX:NYSE) at $123.4 on 3 July, arguing a share price pause for breath had presented investors with the chance to buy a world-leading discounter and high-quality compounder with years of market share gains, earnings growth and progressive dividends ahead of it.

Shares also observed that the ‘off-price’ apparel and home fashions seller occupies something of a sweet spot in retail, since its flexible business model relieves premium brands of excess stock and benefits value-focused shoppers by giving them access to aspirational labels at affordable prices.

WHAT HAS HAPPENED SINCE WE SAID TO BUY?

Our ‘buy’ call has delivered a rapid 12% return, with TJX shares rallying to all-time highs after second-quarter (20 August) revenues and earnings per share beat Wall Street expectations and the retailer raised its full-year 2026 guidance in the face of tariff pressures.

A 7% jump in second-quarter revenue to $14.4 billion came in ahead of consensus expectations, as did the 4% growth in comparable sales. CEO Ernie Herrman commented: ‘Sales, pretax profit margin, and earnings per share were all above our plan. As we have seen through so many different retail and economic environments, consumers were drawn to our excellent values and brands. Customer transactions were up at every division as we saw strong demand at each of our US and international businesses.’

WHAT SHOULD INVESTORS DO NOW?

Keep buying TJX, with further upgrades likely in the near term given that guidance from management remains conservatively pitched. Jefferies, which hiked its price target from $155 to $160 off the back of the results, believes the retailer should benefit from ‘the secular migration toward the off-price sector’ which, in the broker’s view, ‘will likely lead to share gains from other, more traditional retailers. Additionally, we believe Home and International expansion represents unique growth opportunities for TJX’, enthuses Jefferies.

‹ Previous2025-08-28Next ›