The TJX Companies Inc.
) is set to report third-quarter fiscal 2014 results on Nov 19.
Last quarter, it posted a positive surprise of 4.8%. Let us see
how things are shaping up for this announcement.
Factors to be Considered this Quarter
At the investor day held last month, TJX Companies raised the
third-quarter earnings guidance following better-than-expected
comps for the past few months. TJX now expects
third-quarter earnings to range between 84 cents-85
cents versus the original guidance of 69
cents to 72 cents. TJX expects sales growth of 6%-7% and
annual earnings growth of 10% to 13% through 2017. Management
expects to continue its aggressive store expansion and also
raised its store count targets for the next three
We are encouraged by the optimistic outlook and strong comps
of the off-price retailer. Moreover, the newly launched official
website of TJX has proved to be a great success and management
plans to put greater focus on online sales during the coming
quarters. However, there is a possibility of pressured margins in
the coming quarter as the discount retailer will not be able to
raise prices in the face of rising input costs. Moreover, reduced
discretionary spending by consumers amid high taxes and slow job
growth may offset the strategic initiatives of TJX to boost
Our proven model does not conclusively show that TJX is likely
to beat earnings this quarter. A stock needs to have both a
and a Zacks Rank #1, 2 or 3 to surpass earnings estimates.
However, that is not the case here due to the following
ESP for TJX is 0.00% .
TJX Companies' Zacks Rank #2 (Buy) when combined with a 0.00% ESP
makes surprise prediction difficult.
We caution against stocks with Zacks Ranks #4 and 5
(Sell-rated stocks) going into the earnings announcement,
especially when the company is seeing negative estimate revisions
Other Stocks to Consider
Here are some other companies you may want to consider as our
model shows that they have the right combination of elements to
post an earnings beat this quarter:
Best Buy Co., Inc.
), with Earnings ESP of +9.09% and a Zacks Rank #1 (Strong
), with Earnings ESP of +16.67% and a Zacks Rank #2 (Buy).
Trina Solar Limited
), with Earnings ESP of +77.78% and a Zacks Rank #2 (Buy).
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TIVO INC (TIVO): Free Stock Analysis Report
TJX COS INC NEW (TJX): Free Stock Analysis
TRINA SOLAR LTD (TSL): Free Stock Analysis
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