Image Source: TradingView
By Brian Nelson, CFA
The TJX Companies (TJX) recently reported third quarter fiscal 2026 results that beat on both the top and bottom lines. The off-price apparel and home fashions retailer posted net sales for the third quarter of $15.1 billion, an increase of 7% versus the same period of fiscal 2025. Third quarter consolidated comparable sales increased 5%, well above the company’s plan and above consensus of 3.6%. Also above the company’s plan were third quarter pretax profit margin and diluted earnings per share of $1.28, up 12%.
Management had the following to say about the results:
I am extremely pleased with our third quarter performance and the excellent execution of our off-price business model by our teams across the Company. Sales, pretax profit margin, and earnings per share all exceeded our expectations. Overall comp sales grew 5%, with strength at every division. We believe this is a testament to our value proposition and treasure-hunt shopping experience, which continue to draw consumers to our retail banners worldwide. With our outperformance in the third quarter, we are raising our sales, pretax profit margin, and earnings per share guidance for the full year. The fourth quarter is off to a strong start, the availability of merchandise continues to be outstanding, and we are excited about the deals we are seeing in the marketplace. With our compelling values and ever-changing, fresh assortments of good, better, and best brands, we are convinced that our stores and e-commerce sites are strongly positioned as gifting destinations for value-conscious shoppers this holiday season. Going forward, we see great potential to continue capturing market share and successfully growing TJX around the globe.
During the third quarter of fiscal 2026, The TJX Companies (TJX) returned $1.1 billion to shareholders via stock buybacks and dividends. Same store sales strength was prevalent across its brands. Same store sales at Marmaxx increased 6%, HomeGoods increased 5%, TJX Canada increased 8%, while TJX International increased 3%. Total inventories were $9.4 billion compared to $8.4 billion at the end of the third quarter of last year. For the third quarter, the company generated $1.5 billion of operating cash flow and ended the quarter with $4.6 billion in cash. Total debt was $2.9 billion.
ESG Matters
Here’s an excerpt from a message from the CEO:
We are committed to an inclusive and diverse workplace, and believe the many types of diversity, including gender, race, and ethnicity, as well as varied experiences, backgrounds, and perspectives, help us think creatively, remain agile, serve a broad customer demographic, and stay true to our values…We look to work with nonprofit organizations that fulfill basic needs, provide education and training, deliver services for those facing health challenges, and empower women. Through this work, we were proud to reach more than 2,500 nonprofit organizations in 2024 through direct financial support, Associate volunteering, and generous donations from our customers during in-store fundraisers.
When it comes to environmental sustainability, we aim to pursue initiatives that are both environmentally responsible and smart for our business. We have implemented many programs over the years: from installing LED lighting and adding solar panels in certain facilities, to building a network of Asset Recovery and Recycling Centers to support the reuse and recycling of materials from our stores and distribution centers. Our work in this area is designed to contribute toward the environmental sustainability goals that we have set, which aim to achieve net zero greenhouse gas emissions in our own operations, source more renewable energy, divert our operational waste from landfill, and find opportunities to help reduce the environmental impact of certain product packaging.
Concluding Thoughts
For the fourth quarter of fiscal 2026, The TJX Companies continues to plan for consolidated comparable sales growth to be 2%-3%, pretax profit margin in the range of 11.7%-11.8%, and diluted earnings per share to be in the range of $1.33-$1.36. For the full year fiscal 2026, the company is now expecting consolidated comparable sales growth of 4%, a pretax profit margin outlook of 11.6% — up 0.1% versus the prior outlook – and diluted earnings per share in the range of $4.63-$4.66, representing a 9% increase from the prior year’s mark of $4.26.
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Brian Nelson owns shares in SPY, SCHG, QQQ, QQQM, DIA, VOT, RSP, and IWM. Valuentum owns SPY, SCHG, QQQ, QQQM, VOO, and DIA. Brian Nelson’s household owns shares in HON, DIS, HAS, NKE, DIA, RSP, SCHG, QQQ, QQQM, and VOO. Some of the other securities written about in this article may be included in Valuentum’s simulated newsletter portfolios. Contact Valuentum for more information about its editorial policies.
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