Value Shoppers Drive TJX To Q1 Success: Sales And Profits Outperform Expectations

TJX Companies Inc TJX shares are trading higher after the company posted first-quarter FY25 earnings above street view.

The company reported first-quarter FY25 sales growth of 5.9% year-on-year to $12.479 billion, beating the analyst consensus estimate of $12.463 billion.

Overall comp store sales increased 3%, at the high end of the company’s plan, driven by increased customer transactions.

Gross profit margin was 30.0%, a 1.1 percentage point increase versus the prior year, driven by a benefit from lower freight costs and favorable markon

EPS of $0.93 beat the consensus estimate of $0.87.

The company held $5.1 billion in cash and equivalents as of May 4. The company generated $737 million of operating cash flow in the quarter.

Total inventories as of May 4 were $6.2 billion versus $6.4 billion last year. During the first quarter, the company returned a total of $886 million to shareholders.

TJX continues to expect to repurchase about $2 billion – $2.5 billion in fiscal 2025.

“We saw comp sales growth at every division entirely driven by customer transactions, which underscores the strength of our value proposition," said President and CEO Ernie Herrman. 

Outlook: TJX continues to plan FY25 overall comparable store sales growth of 2%-3%.

The company expects FY25 EPS of $4.03-$4.09 (up from $3.94-$4.02) against the consensus of $4.10.

For the second quarter, TJX expects overall comparable store sales to be up 2%-3%. It expects EPS of $0.88 – $0.90, against the consensus of $0.94.

Price Action: TJX shares are trading higher by 1.430% at $99.10 in premarket at the last check Wednesday.

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