TJ Maxx parent logs strong quarter on robust holiday traffic
By Anuja Bharat Mistry
(Reuters) -TJ Maxx parent TJX (NYSE:TJX) Cos surpassed market expectations for fourth-quarter results on Wednesday as budget-conscious shoppers flocked to the off-price retailer's stores in search of holiday deals on apparel, cosmetics and gift assortment.
With interest rates still high, discount retailers such as TJX and Ross Stores (NASDAQ:ROST) have tapped bargain-seeking consumer behavior to take market share from department stores like Macy's (NYSE:M) and Nordstrom (NYSE:JWN), analysts have said.
«Off-price… offers a much more compelling product assortment that is more consumer-centric than a department store, especially in Macy's,» Jane Hali & Associates senior analyst Jessica Ramirez said.
A day earlier, Macy's delivered a weaker annual forecast as the upscale retailer struggled with softer store traffic.
Overall comparable store sales at TJX rose 5% in the quarter, beating market expectations of 4.15%, with the company saying that was «entirely driven by increased customer transactions», indicating robust holiday spending.
However, it forecast fiscal 2025 comparable sales growth of 2% to 3%, below expectations for a 3.72% rise. It expects earnings per share of $3.94 to $4.02, compared with estimates of $4.11.
«TJX is being conservative because we are still in a very volatile time where the consumer continues to be pressured. They will be lapping a very strong 2023 as we go forward,» Ramirez said.
Net sales for TJX's core Marmaxx segment in the U.S. grew 5% in the quarter, driven by demand for cosmetics and skincare products. Its HomeGoods segment rose 7%.
Its quarterly earnings per share of $1.22 came in above estimates of $1.12, aided by lower freight costs and inventory shrink expense.
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