Why Was TJX Stock Up 6% In A Day?
- TJX stock price increased by 6% in a day.
- The rise was due to the company beating expectations in Q2 results.
- TJX also raised its profit outlook for FY 2025.
On August 21, shares of TJX Companies (NYSE: TJX), the parent company of popular off-price retailers Marshalls, TJ Maxx, and HomeGoods, experienced a notable increase of 6.1%, significantly outperforming the S&P 500 index, which rose by only 0.4%. This uptick follows TJX's recent announcement of a $360 million investment in Brands for Less, a leading off-price retailer in Dubai, acquiring a 35% stake in the company. Despite this growth, TJX has struggled to consistently outperform the broader market over the past three years. In its second-quarter earnings report, TJX revealed a year-over-year revenue increase of 6%, totaling $13.5 billion, bolstered by a 4% rise in consolidated comparable sales. The company reported modest growth in its Canadian and international segments, with comparable sales up 2% and 1%, respectively. Additionally, TJX's gross profit margin improved to 30.4%, and its pre-tax profit margin rose to 10.9%, attributed to lower freight costs and robust sales performance. The retailer's net income for the quarter reached $1.1 billion, translating to diluted earnings per share of $0.96, a 13% increase from the previous year. Looking ahead, TJX plans to repurchase between $2 billion and $2.5 billion of its stock during fiscal year 2025 and has raised its expectations for future sales and earnings, projecting a 3% increase in consolidated comparable store sales for the full year. For the upcoming third quarter, TJX anticipates comparable store sales growth of 2% to 3%, with a pre-tax profit margin forecasted between 11.8% and 11.9%. The company has also adjusted its diluted earnings per share outlook to a range of $1.06 to $1.08, reflecting a positive trajectory as it continues to navigate the retail landscape.