Source: Company reports/Fung Global Retail & Technology

3Q17 RESULTS

The TJX Companies reported adjusted 3Q17 EPS of $0.91 versus the consensus estimate of $0.87. Total revenues were $8.29 billion versus expectations of $8.22 billion. Comps increased by 5%, beating expectations of 3.5%, driven by customer traffic. Momentum in both sales and traffic continued in the period. Comps were up 5% at Marmaxx, 6% at HomeGoods and 8% at TJX Canada, and were flat at TJX Europe. During the third quarter, the company increased its store count by 110, for a total of 3,785 stores. The company increased its square footage by 4% over the year-ago period.

OUTLOOK

The company provided 4Q17 guidance for EPS of $0.96–$0.98 versus $0.98–$1.00 previously, based on comp growth of 1%–2% versus consensus of 2.5%. The company’s guidance includes a negative impact of 3% related to wage increases and 6% related to foreign exchange. Marmaxx comps are also expected to increase by 1%–2%. Total revenue is expected to be $9.3–$9.4 billion versus consensus of $9.47 billion. Full-year guidance now calls for EPS of $3.46–$3.48, up from $3.39–$3.43 previously and versus consensus of $3.48. The figure includes a negative impact of 3% related to wage increases and 3% related to foreign exchange. Comps are expected to increase by 4% versus prior guidance of 3%–4%. For fiscal year 2018, the company expects wage increases to have a negative impact of 3% on EPS.