Unlike many of its peers in physical retail, TJX has weathered the last several uncertain years rather steadily, with consistently growing foot traffic from its loyal and enthused fanbase.
TJX — which offers something of a treasure hunt experience for shoppers looking for designer quality goods at big box prices — has turned out to be a model that has been hard for digital players, like Amazon, to imitate or supplant via eCommerce channels. Younger customers are particularly responsive to the TJX model of non-advertised deep discounts, and in Q2 they drove a 34 percent jump in profit and a 6 percent bump in shares just after the results were announced.
“We have been attracting new customers to all our divisions, a significant share of whom are younger customers. This is great for our business today and for the future,” TJX CEO Ernie Herrman said.
Same-store sales were up 6 percent in the second quarter, crushing the 2.2 percent increase analysts had expected. The company also raised its same store sales growth forecast to between 3 percent and 4 percent — above the 2.4 percent estimate.
“(It is) one of the best business models in retail,” Jefferies Group analyst Janine Stichter said in a client note on Monday.
Advertisement: Scroll to Continue
Net income rose to $739.6 million, or $1.17 per share, from $553 million, or 85 cents per share, this time last year. TJX also raised its full-year adjusted profit forecast to between $4.10 and $4.14 per share from a prior outlook of $4.04 to $4.10 per share.
Comparable store sales in the company’s Marmaxx unit, which includes TJMaxx and Marshalls, rose 7 percent, comfortably beating estimates.
