The Silver Lining in TJX Companies’ Wretched Earnings Report

TJX Companies (NYSE: TJX), owner of the T.J. Maxx, Marshalls, HomeGoods, Sierra, and Homesense retail chains, did even worse in the first quarter than analysts were expecting. Sales crashed 52% to $4.4 billion, about $540 million short of the average analyst estimate. The loss per share was $0.74, a full $0.59 worse than analyst expectations.

TJX's first quarter ended on May 2, so its stores were closed for about half the quarter due to the coronavirus pandemic. Gross margin turned negative, and while the company was able to cut operating costs substantially, it burned through a ton of cash. Free cash flow was a loss of nearly $3.2 billion. The company believes it has sufficient liquidity to sustain it for the rest of the year.

It has so far reopened around 1,600 of its more than 4,500 stores. At stores that have been open for more than a week, sales are tracking higher than at the same time last year. TJX expects to have most of its stores reopened by June, although it cautioned that sales could fluctuate as the quarter goes on.

Source Fool.com