Boosted by stronger-than-expected sales growth, TJX Cos. (TJX) beat the Street on Tuesday with a 14% jump in second-quarter profits, prompting the parent of T.J. Maxx and HomeGoods to boost its full-year earnings forecast.
Investors applauded the upbeat news from the retailer, driving its shares 3% higher in premarket trading.
TJX said it earned $479.6 million, or 66 cents a share, last quarter, compared with a profit of $421.1 million, or 56 cents a share, a year earlier. Analysts had been calling for EPS 63 cents.
Revenue jumped 8.4% to $6.44 billion, exceeding the Street’s view of $6.37 billion.
Gross margins ticked up to 28.8% from 28.1% and same-store sales increased 4%, topping the company’s projections.
Looking ahead, TJX raised its full-year earnings targets to $2.74 to $2.80, up from $2.70 to $2.78 previously. By comparison, Wall Street analysts have been expecting full-year EPS of $2.82. Same-store sales are seen rising 2% to 3%.
For the ongoing third quarter, management forecasted EPS of 69 cents to 72 cents on same-store sales growth of 2% to 3%. Consensus estimates from analysts are for EPS of 71 cents.
“The third quarter is off to a solid start and we see many opportunities for the second half of the year and beyond,” TJX CEO Carol Meyrowitz said in a statement. “We are in an excellent inventory position, which gives us the flexibility to capitalize on the great brands and fashions available to us in the marketplace.”
Shares of Framingham, Mass.-based TJX picked up 3.31% to $52.43 ahead of Tuesday’s opening bell, positioning them to build on their 2013 gain of 19.5%.