The TJX Companies, Inc. (NYSE:TJX) stock traded lower Wednesday after the off-price retailer reported second-quarter fiscal 2027 results that beat Wall Street estimates.

Net sales rose 5% year over year to $15.18 billion, beating the $15.17 billion analyst estimate. Adjusted diluted earnings rose 11% to $1.22 per share, beating the $1.19 estimate.

GAAP diluted earnings increased 24% to $1.36 per share from $1.10 a year earlier. Comparable sales rose 4%, above the company’s plan.

Shares traded lower as investors weighed weaker-than-expected third-quarter earnings guidance against the second-quarter beats.

Margins And Segment Performance

Pretax margin expanded 1.9 percentage points to 13.3%. Adjusted pretax margin increased 0.5 percentage points to 11.9%, while adjusted gross margin rose 0.7 percentage points to 31.4%, helped by a higher merchandise margin.

Marmaxx sales rose 3% to $9.11 billion, with comparable sales up 1%. Adjusted segment margin was 14.2%.

HomeGoods sales increased 10% to $2.51 billion, while comparable sales climbed 7%. Adjusted segment margin was 12.4%.

TJX Canada sales rose 6% to $1.47 billion, with comparable sales up 6%. Adjusted segment margin was 16.3%.

International sales increased 11% to $2.09 billion, while comparable sales rose 7%. Adjusted segment margin was 7.3%.

Stores, Inventory And Cash

TJX added 23 stores during the quarter, bringing its total to 5,285. Square footage increased 0.4% sequentially.

Inventory totaled $7.9 billion, up from $7.4 billion a year earlier. Inventory per store increased 2% on a reported basis and 3% at constant currency.

Foreign exchange reduced sales growth by 1 percentage point but added 1 cent to diluted earnings per share.

Operating cash flow totaled $2.2 billion, while cash stood at $6 billion. TJX returned $1.3 billion to shareholders through $798 million of share repurchases and $529 million of dividends.

Current long-term debt totaled $1 billion, while long-term debt stood at $1.87 billion.

Tariff Refunds And Q3 Outlook

TJX received $331 million in IEEPA tariff refunds and recorded $112 million in related compensation accruals. The items resulted in a $219 million pretax benefit and added 14 cents to diluted earnings per share.

For the third quarter, TJX expects comparable sales growth of 2% to 3% and adjusted pretax margin of 12.3% to 12.4%.

The company expects adjusted earnings of $1.30 to $1.32 per share, missing the $1.34 analyst estimate at the midpoint and at the top end of the range.

TJX Raises Full-Year GAAP Earnings Outlook

TJX raised its fiscal 2027 GAAP earnings guidance to $5.31 to $5.36 per share from $5.08 to $5.15. The new range is above the $5.21 analyst estimate.

However, adjusted earnings guidance of $5.15 to $5.20 per share misses the $5.22 analyst estimate.

TJX also raised its adjusted pretax margin outlook to 12% to 12.1% and maintained comparable sales growth guidance of 3% to 4%.

The company plans to increase its store base by about 4% annually beginning in fiscal 2028. It also raised its long-term global store target to 7,500 locations.

TJX Price Action: TJX Companies shares were down 2.82% at $146.60 at the time of publication Wednesday, according to Benzinga Pro data.

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