Shares of The TJX Companies Inc. (TJX) hit a new 52-week high of $69.87 on Feb 25 on the back of impressive fourth-quarter fiscal 2015 results. The company also announced a dividend hike and share repurchase program during its earnings conference call. Shares of this off-price retailer of apparel and home goods eventually closed at $69.38, recording a return of 1.17% year-to-date.
Shares of the off-price retailer have been on the rise over the past two years, backed by consistently high comparable store sales.
Growth Drivers
On Feb 25, 2015, the company reported solid results and discussed earnings and revenues. Solid comparable-store sales growth for consecutive months over the last three quarters drove TJX shares to a new high.
TJX reported 4% comps growth in the fourth quarter that beat management’s expectations. Comps grew on the back of improvement in all the segments. In fact, the company has witnessed solid comparable-store sales growth for consecutive months throughout fiscal 2015.
TJX posted adjusted earnings of 93 cents, up 15% from the prior-year figure, driven by solid top-line growth, higher consumer traffic due to fresh stocks at the stores and solid comparable-store sales growth. Net sales increased 6% year over year to $8.3 billion backed by higher comps. Both pre-tax profit margin and gross margin inflated year over year backed by higher revenues. (Read:TJX Beats Q4 Earnings, Revenues In Line; Initiates FY16 View)
The company also announced its plan to repurchase approximately $1.8 to $1.9 billion of common stocks during fiscal 2016. It also announced plans to hike dividend by 20% to be declared in Mar 2015 and payable in June.
Stocks to Consider
TJX Companies currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the retail sector include Burlington Stores Inc. (BURL), Fred’s Inc. (FRED) and Ross Stores Inc. (ROST). All these stocks have a Zacks Rank #2 (Buy).
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