TJX Companies (TJX)

(A Top Pick May 12/23, Up 24%)

Discount clothing business that is performing well. Owns companies like Winners and HomeSense. Higher interest rates pushing consumers to lower priced shopping centers. Has sold shares (believes is fully valued). 

He added more. The consumer is trading down (see Kellogg's and Starbucks earnings). There's growth here again, and have been increasing their modest dividend. Boast $4 billion in free cash flow the past year.

They benefit from their core consumers and customers looking for a bargain at a time when consumers are upset in paying more for things. TJX says quality inventory and their results have been good. A brick-and-mortar retail success.

They recently reported top and bottom line beats along with light guidance, the latter of which triggered weakness in shares. Those sellers jumped the gun, though. The CEO notes that the supply of discounted merchandise will continue, and in fact the closure of 150 Macy's stores will be a bonanza for them. TJX will be fine.

It reports Wednesday. Investors typically sell this, even on good results, which creates a buying opportunity.

Not a cheap stock, but are benefitting from excess inventory of recent years. They increased their comp guidance last quarter from 3-4% to 4-5%, unheard of for them. Has owned this forever. They have pricing power. Buy on the day they report earnings, because it always sells on the news.

The question was on his preference between Walmart or TJX. Walmart is at an attractive valuation and TJX has done well. However he prefers 5 Below (FIVE) and would wait for a pullback to buy the stock.

Both. Buy them 50/50. Costco is about their memberships, and TJX is the best off-price retailer around.

They reported last Wednesday despite beating their quarter. But they slightly lowered their earnings forecast, so shares fell. Remains an excellent, conservative company. Weakening consumers will spend more here in the future.

They saw two price target hikes today. TJX does well only when other retailers are struggling (a sign of a weakening economy). Once a consumer gets hooked on TJX, they don't go back.

Made a new high today. Strong earnings and good performance. Happy to own it.

Disconnect between a company and the stock. Trading at high end of multiple range, now at a 35% premium to the market. Price has already baked in investors using it as a place to hide out for an upcoming downturn.

Upgraded today. TJX will benefit from consumers trading down and from new home sales. Also, they benefit from excess inventory in the sector. Not cheap, but still likes it. Can do 2-3% comps over long term, and shipping costs are coming down.

TJX reported EPS of $0.76 vs $0.71 expected. Revenues of $11.78 mln were just shy of expectations at $11.82 mln, but essentially in-line and raised their annual profit guidance. The quarter was helped by freight rates coming down and they also noted an uptick in traffic recently. The results looked fine here and the outlook sounds optimistic even in the face of a more conservative expectation for Q2.
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