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Insight Reports 2 minutes

The TJX Companies Inc (TJX) 1Q17 Results: Another Strong Quarter; 2Q Off to a Solid Start

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Coresight Research

Key Points

  • The TJX Companies reported 1Q17 EPS of $0.76 versus the consensus estimate
    of $0.71.
  • Total revenue was up 10% year over year, to $7.54 billion, versus expectations of $7.29 billion. Comps were up 7% versus consensus of 3.2%. By division, comps were up 6% at Marmaxx, 9% at HomeGoods, 14% at TJX Canada and 4% at TJX International. Comps in every division were driven by strong traffic.
  • Management provided 2Q17 guidance for EPS of $0.77–$0.79 versus consensus of $0.83, and commented that the quarter is off to a “solid start.” Comps are expected to increase by 2%–3% in the period. The company raised its full-year EPS projection to $3.35–$3.42, based on an expected comp increase of 2%–3%.

Source: Company reports

1Q17 RESULTS

The TJX Companies reported 1Q17 EPS of $0.76 versus the consensus estimate of $0.71.

Total revenue was up 10% year over year, to $7.54 billion, versus expectations of $7.29 billion. Comps were up 7% versus consensus of 3.2%. By division, comps were up 6% at Marmaxx, 9% at HomeGoods, 14% at TJX Canada and 4% at TJX International (Europe and Australia). Comps in every division were driven by strong traffic.

Consolidated inventory on a per-store basis ended the period up 7%. That includes inventory in distribution centers, but excludes inventory in transit and in the e-commerce channel. The figure compares to total sales growth of 10% and comp growth of 7%. Management is comfortable with the inventory positioning going into 2Q17.

2017 OUTLOOK

Management provided 2Q17 guidance for EPS of $0.77–$0.79 versus consensus of $0.83, and said that the quarter is off to a “solid start.” Guidance assumes that wage increases will weigh on EPS growth by 3% and that foreign exchange will have an additional 2% negative impact on EPS growth. Comps are expected to increase by 2%–3% in the period.

The company raised its full-year EPS projection to $3.35–$3.42, based on an expected comp increase of 2%–3%. Guidance assumes foreign exchange and wage increases will have a 6% negative impact on EPS growth.

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