A few months ago, I asked who you thought was the best stock picker around. My guess was that many of you would say Warren Buffett, Carl Icahn, and Peter Lynch. All good answers, for sure. But for me, the best stock picker I know is my mom.
To be completely honest, my mom isn’t a typical stock picker. She doesn’t spend her time researching and trying to find the best stocks on Wall Street. But indirectly, she’s fantastic.
One of the stocks she turned me on to long ago has made people a lot of money over the last few years. It was up 9% in 2014, but in the last five years it’s nearly tripled! The stock has been in the headlines recently after a stellar third-quarter earnings report, which is why I’m bringing it up today.
TJX Stock Has Seen Impressive Gains
TJX Companies (TJX) is the leading global off-price retailer of apparel and home fashions, selling its merchandise at a 20%-60% discount to department and specialty stores. The company has more than 3,300 stores in seven countries under varying names. Some of the more well-known brands in the U.S. include T.J. Maxx, Marshalls, and HomeGoods — which, by the way, is where my mom says I should buy all my stuff.
The company reported third-quarter earnings on November 17 and TJX stock is up more than 7.5% as a result. Earnings of $0.86 per share beat estimates by $0.02, while revenue grew 5% year over year to $7.75 billion, which was also better than expectations of $7.68 billion.
Higher consumer traffic and strong comparable store sales helped boost the bottom line (the company has experienced only one year of declining comparable store sales in its 38-year history).
Looking ahead, management provided fiscal fourth-quarter EPS guidance of $0.91-$0.93, compared to $0.93 last year. Comparable store sales are expected to grow 2%-3% in the quarter. For the full year, TJX is looking for diluted earnings of $3.26-$3.28 on a 4%-5% increase in comparable store sales, which is up from previous guidance of 3%-4% growth.
What Can Investors Expect From TJX Stock?
It’s true that the retail industry has had a rough couple of weeks following disappointing earnings results and guidance from Macy’s (M) on November 11. And just a few days later, Nordstrom (JWN) also slashed its forward guidance. While TJX stock certainly felt the pain, pulling back nearly 15% from its near-term high earlier this month, management noted very healthy demand for the holiday shopping season, and the stock has made a strong post-earnings rebound to trade just a few dollars from its November peak.
So, here’s the bottom line: TJX is ripping it right now. TJX stock has made a spectacular rebound over the last few days, and I suspect that momentum can continue, given this “buying-and-selling” time of year.
One thing is for sure… my mother doesn’t tend to steer me wrong.
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