TJ Maxx Stock Price Rises, Walmart Sees Drop as Both Report Earnings
Key takeaways
- TJ Maxx and Walmart both reported higher revenue, earnings and adjusted full-year guidance this week
- TJ Maxx shares climbed 4.7%, though Walmart fell 2.2% at news of a softer Q3 prediction than expected
- Both are a huge difference to struggling Target’s performance in the second quarter
TJ Maxx and Walmart rounded off the retailer earnings season with positive news from both brands. Consumers are flocking to discount stores like TJ Maxx, while Walmart’s focus on essentials has paid off in the long run. Both offer a stark contrast to Target, which had a mixed earnings beat earlier this week. Here’s what you need to know.
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How did TJ Maxx and Walmart do with earnings?
TJ Maxx was every investor’s favorite on Wednesday, having posted better earnings and sales than expected, as well as raising its full-year guidance.
Second-quarter sales for the discount retailer were $12.8 billion, and adjusted earnings per share were 85 cents, compared to the $12.5 billion revenue and 77 cents earnings analysts had predicted. The retailer put the surge in sales down to consumers being more mindful of their spending against a challenging macroeconomic environment.
As for Walmart, expectations were high, and the shopping conglomerate delivered. Revenue was up 5.7% for the quarter to $161.6 billion, beating out the $160.2 billion prediction from analysts. Adjusted earnings per share reached $1.84, smashing the $1.71 forecast. The company also raised its full-year guidance.
Walmart CEO Doug McMillon credited the shopping giant’s focus on groceries and essential items as helping to drive the bottom line through the tough times for retailers.
What was Wall Street’s reaction?
As softer third-quarter earnings guidance weighed on the stock, Walmart shares fell 2.2% at the news. TJ Maxx, however, enjoyed a 4.7% lift to the stock, which put the price at an all-time high of $89.78.
The two retailers weren’t the only ones to report earnings this week. Target posted a decidedly downbeat earnings report, cutting its full-year forecast and missing sales expectations for the second quarter, and that’s not happened in four years.
However, because investors’ expectations were basically on the floor anyway, Wall Street looked on the sunny side of the report, which included earnings per share way above expectations and healthier inventory levels. Target shares jumped as high as 10% in premarket trading on Wednesday, closing the trading day up 3%.
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