store sales forecast as shoppers hunt for deals
(Reuters) TJX Cos Inc nike air , the owner of off price chains TJ Maxx and Marshalls, reported a bigger than expected rise in quarterly comparable store sales as more bargain hungry shoppers visited its stores for apparel, accessories and household goods.
TJX also raised its comparable sales growth forecast for the year ending January, indicating healthy demand for the holiday shopping season, in contrast with full price department stores such as Macy's Inc and Nordstrom Inc , which cut their forecasts last week.
The strong results and forecast sent TJX's shares up as much as 6.5 percent on Tuesday and also boosted its rivals Ross Stores nike headbands Inc and Burlington Stores Inc .
TJX and other off price chains sell home furnishings and apparel brands such as Dolce and Gabbana and Juicy Couture priced 20 60 percent lower than at most retailers, helping them draw price conscious customers away from full price retailers.
"We believe this momentum will continue," Guggenheim Securities analyst Howard Tubin wrote of TJX in a client note.
TJX has been the world's No.1 apparel and footwear retailer by revenue since 2007, according to Euromonitor, whose list includes retailers such as Gap Inc and American Eagle Outfitters , but excludes companies such as Nike Inc , which mainly sells to wholesalers.
Macy's and Nordstrom last week reported disappointing same store sales and cut their full year forecasts, which analysts said may indicate consumers are increasingly expecting deeper discounts.
TJX's comparable sales rose 5 percent in the third quarter ended Oct. 31, more than the 3.9 percent growth analysts on average were expecting, according to Consensus Metrix.
The retailer raised its comparable sales growth forecast to 4 5 percent for the year ending Jan. 30 from 3 4 percent.
The company said it was "very comfortable" with its inventory position, which it raised ahead of the holiday quarter to be able to send fresh merchandise to its stores. Macy's said last week that it would be forced to offer discounts nike y adidas in the quarter to clear fall season inventory.
TJX's net income fell 1.3 percent to $587.3 million in the third quarter. On a per share basis it earned 86 cents per share. Revenue rose 5.3 percent to $7.75 billion.
Analysts on average were expecting a profit of 84 cents per share on revenue of $7.73 billion, according to Thomson Reuters I/B/E/S.
TJX said it expects average ticket prices to fall in the current quarter and forecast sales of $8.6 $8.7 billion. Analysts were expecting $8.74 billion.