(Reuters) -TJX Cos raised its annual profit forecast on Wednesday, benefiting from lower costs and strong demand from cash-strapped customers flocking to its off-price stores for products such as apparel and footwear.
The TJ Maxx and Marshalls parent has hit the right spot as customers continue to hunt for value and better deals even as inflationary pressures ease, driving steady traffic and sales at the company’s outlets.
Retailers including TJX (NYSE:TJX), Walmart (NYSE:WMT) and Amazon (NASDAQ:AMZN) have rolled out deals on everything from toys to household items earlier than usual this holiday shopping season as they are locked in a battle for penny-pinching shoppers.
“Customer transactions drove our comp sales increases, which tells us that our values and treasure hunt shopping experience are appealing to a wide range of customers,” TJX CEO Ernie Herrman said in a statement.
The Marshalls chain parent expects annual earnings per share of $4.15 to $4.17, compared with its prior forecast of $4.09 to $4.13.
It, however, maintained its annual comparable store sales forecast to be up 3%. TJX’s shares, up 28% this year, were down 1% in volatile premarket trading.
Ahead of the all-important holiday shopping season, the top two U.S. retailers have provided different pictures of the consumer.
Retail giant Walmart, which offers products at the lowest price possible, again raised its annual forecasts. Smaller rival Target (NYSE:TGT), where non-essentials account for a bigger share of revenue, signaled a muted holiday season.
TJX’s net sales rose 6% to $14.1 billion in the third quarter, beating analysts’ average estimate of $13.95 billion, according to data compiled by LSEG.
On an adjusted basis, the company reported a profit of $1.14 per share, compared with estimate of $1.09.