TJX (TJX) Stock Forecast & Price Target

TJX Companies exhibited a strong performance in its most recent quarter, with total inventory increasing by 7.6% year-over-year, reflecting robust demand for its off-price offerings. The company's Marmaxx division achieved a notable EBIT margin expansion of approximately 60 basis points year-over-year, marking the eighth consecutive quarter of improvement, which signifies operational efficiency and profitability. Additionally, the firm maintained a planned gross margin of about 30.3%, underscoring the effectiveness of its purchasing strategies and continued customer acquisition, as evidenced by the sales guidance of $15.9 billion to $16.1 billion driven by increased customer engagement during the holiday season.

The outlook for TJX Companies is negatively affected by anticipated declines in gross margin and operating margin, with 4Q24 gross margin projected between 29.4%-29.5%, significantly lower than the 19.8% recorded last year. Furthermore, the expected EPS for the fourth quarter falls to $1.12-$1.14, a decline from $1.22 the previous year, exacerbated by the lack of benefit from a 53rd week this time. Additionally, Canada's sales continue to show weakness with a third consecutive quarterly contraction, highlighting broader challenges within the company's international operations.