Last Update 09 Jan 26

Fair value Increased 2.32%

TJX: Off Price Execution And FY26 Guidance Will Support Multi Year Outlook

Analysts nudged their price target for TJX higher to about $164 from roughly $160, citing supportive Street research that highlights stronger Q3 results, updated FY26 guidance, and broad confidence in off-price retail trends and TJX's multi-banner momentum.

Analyst Commentary

Recent research points to a generally constructive stance on TJX, with multiple firms lifting valuation targets after the Q3 report and updated FY26 guidance. The discussion now centers on how much of the execution and growth story is already reflected in the share price and where future upside or risk could come from.

Bullish Takeaways

Bullish analysts highlight Q3 as a strong proof point, with comments around broad-based top line strength across segments, demographics, regions, and categories supporting confidence in execution quality.
Several firms cite TJX's off price positioning and value proposition as well aligned with current consumer spending patterns, with some pointing to targeted pricing actions across nearly all categories as supportive for revenue and gross margin.
Higher price targets in the US$160 to US$184 range are tied to views that TJX's multi banner model, including concepts like HomeSense and Sierra Trading Post, and its international footprint, could support further growth over time.
Goldman Sachs and other bullish analysts point to TJX's updated FY26 guidance and forward commentary as evidence that the company is executing consistently, which they see as supportive of premium quality status within off price retail.

Bearish Takeaways

More cautious analysts flag valuation as a key concern, even as they acknowledge strong recent performance and a solid buying environment, suggesting the shares may already price in a meaningful portion of the story.
While Q3 is generally viewed positively, some commentary implies that expectations for continued beats, including into Q4, could raise the bar for future results and leave less room for execution missteps.
One research view characterizes TJX as an Equal Weight idea despite strong comparable sales and margin upside, indicating that, at current levels, risk and reward may appear more balanced than skewed decisively in favor of further rerating.
Several firms reference broader macro conditions and consumer sentiment in 2025 and into 2026, suggesting that external factors around discretionary spending remain a watch point for the durability of growth assumptions embedded in current targets.

What's in the News

TJX raised full year fiscal 2026 guidance, now expecting consolidated comparable sales to be up 4%, a pretax profit margin of 11.6% compared with 11.5% in the prior year, diluted EPS of US$4.63 to US$4.66 versus US$4.26 in the prior year, and full year consolidated sales of US$59.7b to US$59.9b (Key Developments).
For the fourth quarter of fiscal 2026, TJX maintained guidance for consolidated comparable sales growth of 2% to 3%, a pretax profit margin of 11.7% to 11.8%, and diluted EPS of US$1.33 to US$1.36 (Key Developments).
Between August 3, 2025 and November 1, 2025, TJX repurchased 4,233,408 shares, or 0.38% of shares, for US$593.6m, completing a tranche totaling 4,840,277 shares, or 0.43%, for US$669.74m under the buyback announced on February 26, 2025 (Key Developments).
TJ Maxx launched the Maxxinista Express, a holiday themed double decker bus road trip in Los Angeles, Dallas, and Miami, offering superfans store visits, shopping challenges, exclusive merchandise, and social media friendly experiences tied to the #Maxxinista community (Key Developments).

Valuation Changes

Fair Value: Adjusted from about US$160.39 to roughly US$164.11 per share, a small upward move.
Discount Rate: Updated from 8.56% to about 8.61%, reflecting a slight increase in the required return input.
Revenue Growth: Tweaked from roughly 5.40% to about 5.42%, representing a very modest adjustment in the growth assumption.
Net Profit Margin: Refined from about 9.27% to roughly 9.28%, indicating a minimal shift in expected profitability.
Future P/E: Updated from about 34.94x to roughly 35.74x, showing that a slightly higher valuation multiple is being applied.

Broad-based growth in customer transactions and increasing store traffic highlight strong consumer demand for value, supporting ongoing revenue and market share gains.
Favorable merchandise sourcing and operational efficiencies are driving higher margins and earnings, while continued global expansion and investments fuel long-term profitability.
Shifts in consumer habits, digital competition, sourcing challenges, rising costs, and sustainability concerns threaten TJX's core off-price retail model, pressuring future growth and margins.

Catalysts

About TJX Companies

Operates as an off-price apparel and home fashions retailer worldwide.What are the underlying business or industry changes driving this perspective?

Stronger-than-expected and broad-based growth in customer transactions across all divisions, combined with consistent above-plan comp sales, signals that consumers are increasingly drawn to value-focused retail options in a macro environment marked by economic uncertainty-supporting ongoing revenue growth and market share gains.
Management emphasized robust merchandise availability due to excess inventory in the market, which allows TJX's experienced global buying teams to secure quality branded goods at favorable prices; this should underpin higher gross margins and mitigate cost pressures, supporting stronger future earnings.
The company's uniquely flexible, discovery-driven in-store experience is driving higher store traffic from a wide demographic range-including increased engagement from younger customers-capitalizing on consumer desire for experiential shopping and repeat visits, thus supporting both top-line revenue and frequency of purchases.
Global expansion continues with strong comp sales and segment profit margin growth in international markets (Canada, Europe, Australia), while management sees a long runway for additional store openings worldwide, which will help diversify revenue streams and fuel top-line and EPS growth.
Investments in merchandising, planning/allocation, and marketing-along with enhanced store remodel programs-are enabling operational efficiencies, superior in-store execution, and deeper customer loyalty, which should support net margin resilience and improve long-term profitability.

TJX Companies Earnings and Revenue Growth

TJX Companies Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming TJX Companies's revenue will grow by 5.8% annually over the next 3 years.
Analysts assume that profit margins will increase from 8.6% today to 9.1% in 3 years time.
Analysts expect earnings to reach $6.3 billion (and earnings per share of $5.84) by about September 2028, up from $5.0 billion today. The analysts are largely in agreement about this estimate.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 32.4x on those 2028 earnings, up from 31.3x today. This future PE is greater than the current PE for the US Specialty Retail industry at 18.7x.
Analysts expect the number of shares outstanding to decline by 1.32% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 8.32%, as per the Simply Wall St company report.

TJX Companies Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

Accelerating consumer shift to e-commerce: Despite some U.S. e-commerce initiatives, the call highlighted strong physical store traffic and in-store execution as primary drivers of comp sales, with little focus on major digital investments, suggesting ongoing risk that continued e-commerce growth could erode physical foot traffic and long-term revenue growth.
Inventory sourcing risk from improved brand supply chains: The company's ability to capitalize on "super strong availability" and "excess inventory" from vendors was repeatedly emphasized, but longer-term if brands become better at managing inventory or shift more to direct-to-consumer channels, TJX's access to quality off-price merchandise may diminish, compressing gross margins and limiting earnings growth.
Rising labor and operating costs: The call mentioned cost efficiencies, but persistent wage inflation, minimum wage hikes, and increased maintenance/remodeling costs for its large, aging store fleet pose a long-term risk to SG&A leverage and net margins as fixed costs rise faster than revenue.
Changing consumer focus toward sustainability: TJX's model depends on fast inventory turnover and high volumes, but as consumers increasingly prioritize sustainable, ethical sourcing and curated wardrobes, off-price retailers could see reduced appeal, pressuring both traffic and future sales growth.
Intensifying competition from digital-native and DTC brands: The company maintains that its in-store "treasure hunt" experience is a competitive advantage, yet ongoing growth from online discounters, manufacturer DTC initiatives, and improved digital shopping experiences threaten to erode TJX's market share and moderate future revenue and earnings expansion.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $149.444 for TJX Companies based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $172.0, and the most bearish reporting a price target of just $90.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $68.6 billion, earnings will come to $6.3 billion, and it would be trading on a PE ratio of 32.4x, assuming you use a discount rate of 8.3%.
Given the current share price of $139.97, the analyst price target of $149.44 is 6.3% higher. The relatively low difference between the current share price and the analyst consensus price target indicates that they believe on average, the company is fairly priced.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

Raised Guidance And Solid Performance Will Drive Further Market Share Gains