TJX Companies Lifts 2017 Outlook As Q1 Results Beat View

(RTTNews) - Off-price retailer TJX Companies, Inc. (TJX) on Tuesday reported an increase in profit for the first quarter from last year, reflecting double-digit growth in sales and strong customer traffic. Both revenue and earnings per share for the quarter beat analysts' expectations.

Looking ahead, the company forecast earnings for the second quarter below the Street estimates, citing wage increases and foreign currency impacts. However, the company raised its financial outlook for fiscal 2017.

The Framingham, Massachusetts-based company's first-quarter net income was $508.35 million or $0.76 per share, up from $474.60 million or $0.69 per share in the prior-year quarter.

On average, 28 analysts polled by Thomson Reuters expected the company to report earnings of $0.71 per share. Analysts' estimates typically exclude special items.

Net sales for the quarter increased 10 percent to $7.54 billion from $6.87 billion in the same quarter last year and beat analysts' consensus revenue estimate of $7.29 billion.

Consolidated comparable store sales for the quarter rose 7 percent, compared to an increase of 5 percent in the same period last year. The increase was driven by strong customer traffic.

Looking ahead to the second quarter, TJX Companies forecast earnings in a range of $0.77 to $0.79 per share, compared to $0.80 per share in the year-ago period. The earnings outlook is based upon estimated consolidated comparable store sales growth of 2 percent to 3 percent. Analysts expect the company to earn $0.82 per share for the quarter.

The company's guidance reflects an assumption that wage increases will negatively impact earnings per share growth for the quarter by 3 percent, and the combination of foreign currency and transactional foreign exchange to have an additional 2 percent negative impact on earnings per share growth.

For fiscal 2017, TJX Companies now forecast earnings in a range of $3.35 to $3.42 per share, based on a raised estimate of consolidated comparable store sales growth of 2 percent to 3 percent.

Earlier, the company forecast full-year earnings in a range of $3.29 to $3.38 per share, on estimated consolidated comparable store sales growth of 1 percent to 2 percent.

The Street is currently looking for full-year earnings of $3.46 per share.