Friday, December 09, 2011

TJ Maxx (TJX) 2011 Review

TJX is rated A+ by Value Line, has a 22% debt to equity ratio and its stock yields 1.3%.

TJX Companies are a leading off-price retailer of clothing, accessories and home fashions primarily under the TJ Maxx and Marshall’s brands.

The company has grown profits and dividends at a 13-20% pace over the past ten years earning a 30%+ return on equity. TJX should continue this performance because:

(1) the company’s business model provides flexibility, improving both sales and margins,

(a) it can alter its product offerings more frequently than traditional retailers, allowing it to stay very close to current market trends,

(b) its opportunistic buying strategy enables it to take advantage price bargains in the marketplace.

(2) new store growth,

(3) e-commerce opportunities,

(4) it operates with a low cost structure emphasizing cost controls, inexpensive store fixtures and obtaining efficiencies in its distribution network and supply chains.

Statistical Summary

Stock YieldDividend Growth RatePayout Ratio # Increases Since 2001

Debt/EquityROEEPS Down Since 2001 Net MarginValue Line Rating


Notes: TJX stock made great progress off its March 2009 low, quickly surpassing the down trend off its September 2008 high (straight red line) and the November 2008 trading high (green line). The stock is in a long term up trend (blue lines) as well as an intermediate term uptrend (purple lines). The wiggly red line is the 30 day moving average. The Aggressive Growth Portfolio does not own a position in TJX, having Sold its shares when the stock hit its Sell Half Range in April 2010.

Steve Cook received his education in investments from Harvard, where he earned an MBA, New York University, where he did post graduate work in economics and financial analysis and the CFA Institute, where he earned the Chartered Financial Analysts designation in 1973. His 40 years of investment experience includes institutional portfolio management at Scudder, Stevens and Clark and Bear Stearns. Steve's goal at Strategic Stock Investments is to help other investors build wealth and benefit from the investing lessons he learned the hard way.