Major US retailers delivered a mixed picture on Wednesday. TJX Companies shares fell about 3% in premarket trading after the off-price retailer posted a second-quarter earnings beat but offered third-quarter guidance below Wall Street expectations. TJX reported adjusted diluted EPS of $1.22, beating the $1.19 consensus, on revenue of $15.18 billion, roughly in line with estimates. Comparable store sales rose 4%.
The disappointment came from third-quarter guidance: TJX projected adjusted EPS of $1.30 to $1.32, below the $1.35 analyst estimate. Management nevertheless raised its full-year fiscal 2027 EPS outlook to $5.31 to $5.36, up from $5.08 to $5.15 previously, and lifted full-year pretax margin guidance to 12.3% to 12.4%. The quarter included a one-time $331 million tariff refund related to the International Emergency Economic Powers Act. Excluding that item, adjusted pretax margin was 11.9%, up 0.5 percentage points year over year.
CEO Ernie Herrman noted that the Marmaxx division, which includes T.J. Maxx and Marshalls, posted comparable sales growth of just 1%, while HomeGoods, TJX Canada and TJX International recorded gains around 6% to 7%. TJX returned $1.3 billion to shareholders through buybacks and dividends during the quarter and still targets $2.75 billion to $3.0 billion in repurchases for the full year. The company also plans to increase new store openings to a 4% annual pace starting in fiscal 2028 and raised its long-term global store target to 7,500 locations.
Separately, Target extended gains after reporting better-than-expected second-quarter results. The retailer earned $2.46 per share on revenue of $26.54 billion, helped partly by tariff refunds. Including the post-earnings move, Target stock is up nearly 60% year to date in 2026.
Famed investor Jim Cramer said he is bullish on Target but would wait for a pullback before buying. On CNBC, Cramer said investors should let the stock come in before buying. He credited new CEO Michael Fiddelke with reenergizing the company, highlighting aggressive price cuts on 10,000 items and market-share gains in food. Cramer also emphasized Target's 3.6% increase in store traffic as a sign of consumer health and broader macroeconomic stability. Target's full-year guidance now calls for at least $9.90 per share in earnings, above the $9.50 consensus high end. Wall Street rates the stock a Moderate Buy with an average price target of $180, implying more than 12% upside potential. The dividend yield stands at about 2.89%.
