TJX Companies Inc (TJX, Financial) has recently captured the attention of investors and financial analysts with its strong financial performance. Currently trading at $101.79 per share, TJX has experienced a daily increase of 4.19% and a three-month growth of 2.98%. A detailed analysis, supported by the GF Score, indicates that TJX Companies Inc is poised for significant future growth.
What Is the GF Score?
The GF Score is a proprietary ranking system developed by GuruFocus, assessing stocks based on five key valuation aspects from 2006 to 2021. Stocks with higher GF Scores typically yield better long-term returns. The GF Score ranges from 0 to 100, with 100 indicating the highest potential for outperformance. TJX Companies Inc boasts a GF Score of 94, reflecting its strong potential for market outperformance.
- Financial strength rank: 7/10
- Profitability rank: 9/10
- Growth rank: 9/10
- GF Value rank: 6/10
- Momentum rank: 10/10
Understanding TJX Companies Inc Business
TJX Companies Inc, with a market cap of $115.28 billion and annual sales of $54.22 billion, is the leading off-price retailer in the United States. The company benefits from over 21,000 global vendor relationships, allowing it to offer brand-name merchandise at 20%-60% below traditional retail prices. TJX's strategy of purchasing excess inventory from manufacturing overruns and retail closeouts has proven effective. The company operates 4,950 stores worldwide, providing a unique treasure-hunt shopping experience. The majority of TJX's revenue is generated in the United States through its T.J. Maxx, Marshalls, and HomeGoods stores, with about 22% of sales coming from Canada, Europe, and Australia.
Financial Strength Breakdown
TJX Companies Inc's financial robustness is evident in its impressive Interest Coverage ratio of 73.38, significantly above Benjamin Graham's recommended threshold of 5. This indicates a strong ability to meet interest obligations. The Altman Z-Score of 5.86 further underscores TJX's financial stability, suggesting a low probability of financial distress. Additionally, a Debt-to-Revenue ratio of 0.23 highlights effective debt management.
Profitability and Growth Metrics
The Profitability Rank of TJX reflects its superior ability to generate profits relative to its peers. This is supported by a consistent increase in Gross Margin over the past five years, with the latest figure at 30%. The Piotroski F-Score further confirms the company's healthy financial state. Growth is also a strong suit for TJX, with a Growth Rank of 9/10, highlighted by a 20.9% 3-Year Revenue Growth Rate, outperforming 82.41% of its industry peers.
Conclusion
Considering TJX Companies Inc's strong financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential outperformance. Investors looking for similar opportunities can explore more companies with strong GF Scores using the GF Score Screen.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
