Key facts
- TJX Companies reported Q4 net sales of $11 billion, a 16% increase year-over-year.
- Consolidated comparable-store sales increased by 4% in the fourth quarter.
- Q4 earnings per share were $1.37, including a 17-cent tax benefit.
- The company announced plans for a $3 billion stock buyback program.
- TJX's Q4 earnings and sales exceeded FactSet consensus estimates.
- A slowdown was noted at TJ Maxx and Marshalls due to execution issues.
TJX Companies reported a robust fourth quarter with net sales reaching $11 billion, a 16% increase compared to the previous year. Consolidated comparable-store sales rose by 4%, driven by higher customer traffic across its brands. The company's earnings per share for the quarter were $1.37, a 33% jump that included a 17-cent benefit from a tax-related adjustment. This performance exceeded FactSet consensus estimates for both earnings ($1.27) and sales, with comparable-store sales nearly doubling the estimated 2.1% growth.
Despite a self-inflicted slowdown in its apparel divisions, TJ Maxx and Marshalls, due to certain product availability issues, the company's home goods business showed strong growth. CEO Ernie Herrman acknowledged these execution challenges in the apparel segments but highlighted the overall positive performance.
Buoyed by the strong results and a tax benefit, TJX announced plans to repurchase up to $3 billion of its own stock over the next year and provided a one-time bonus to its associates. For the full fiscal year, net sales increased by 8% to $35.9 billion, with comparable-store sales up 2%. Diluted earnings per share for the year grew 16.8% to $4.04.
Analysts, including those from Morgan Stanley and Cowen, had anticipated strong holiday results from off-price retailers like TJX, citing factors such as inventory availability and improved execution. Neil Saunders of GlobalData Retail described the performance as a "solid underlying performance" that demonstrated the continued strength of the off-price market.