TJX shares have dropped 17.4% over the past month even after second-quarter fiscal 2027 adjusted earnings of $1.22 per share beat the Zacks Consensus Estimate of $1.18 and management raised its full-year adjusted earnings outlook to $5.15 to $5.20 per share. The selloff centers on Marmaxx, TJX's largest division, where comparable sales rose just 1% in the second quarter, below management's expectations, on a higher average basket partly offset by a small decline in customer transactions; management called the shortfall self-inflicted and tied to merchandise mix, and said trends improved early in the third quarter. The weakness at Marmaxx was offset by the rest of the company, as consolidated comparable sales rose 4% and net sales climbed 5% to $15.18 billion, with HomeGoods comparable sales up 7%, TJX Canada up 6% and TJX International up 7%. Adjusted selling, general and administrative costs reached 19.7% of sales, 20 basis points unfavorable year over year on higher store wage and payroll costs, and third-quarter adjusted gross margin is projected at 32.1% to 32.2%, down 40-50 basis points, mainly on higher fuel costs, while currency movements cut second-quarter reported net sales growth by 1 percentage point. TJX's forward 12-month price-to-sales ratio of 2.06 remains above the Zacks sub-industry's 1.58 and its own five-year median of 1.95, leaving investors focused on whether Marmaxx improves as expected while the company manages wage and fuel pressure.
The TJX Companies IncThird-quarter adjusted gross margin is projected down 40-50 basis points on higher fuel costs, with SG&A 20 bps unfavorable on wage/payroll costs.
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