Erste Group reinstates TJX stock with Buy rating, citing strong margins

Published 05/09/2025, 11:44
Erste Group reinstates TJX stock with Buy rating, citing strong margins

Investing.com - Erste Group has reinstated coverage on The TJX Companies (NYSE:TJX) with a Buy rating on Friday. The stock is currently trading near its 52-week high of $145.58, with InvestingPro data showing the company maintains a "GREAT" overall financial health score.

The research firm highlighted TJX’s superior financial metrics compared to competitors, noting the company maintains a much higher return on equity of 60% and significantly higher operating margins. As a prominent player in the Specialty Retail industry, TJX has demonstrated consistent strength with a 15.7% return on assets.

TJX recently raised its guidance for 2025, reflecting strong business performance this year. The company now expects its pre-tax margin to reach approximately 11.4%, up from 11% in the previous year.

The off-price retailer has projected earnings per share to fall within a range of $4.52 to $4.57, representing annual growth of 6% to 7%.

Erste Group expressed confidence that TJX will slightly exceed its own forecasts for the current fiscal year.

In other recent news, The TJX Companies reported strong second-quarter earnings, with earnings per share of $1.10, surpassing Wall Street’s expectations of $1.01. The company achieved a 4% growth in same-store sales, exceeding the anticipated 3.4% increase, and expanded its pre-tax margin by 50 basis points year-over-year to 11.4%, above the expected 10.9%. Following these results, several analyst firms have raised their price targets for TJX. Bernstein increased its target to $152, citing TJX’s potential to outperform competitors and drive a higher earnings per share algorithm. JPMorgan set a new target of $148, maintaining an Overweight rating due to the strong quarterly performance. Telsey Advisory Group raised its target to $155, highlighting solid operational execution and a lower-than-expected tariff impact. BofA Securities also raised its target to $150, noting better-than-expected sales and margins, along with raised guidance from the company. Additionally, Wells Fargo increased its target to $130, acknowledging TJX’s strong performance despite an uncertain macroeconomic environment.

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