TJX Companies

1
TJX Companies

• Analyst Ryan Shontz
• 10/12/04

2
Company Profile

• The leading off-price retailer of apparel and
  home fashions in the United States and worldwide
• 7 segments, 8 stores, and 2062 points of sale
• Marmaxx-T.J. Maxx Marshals
• A.J. Wright
• Homegoods
• Bobs Stores
• T.K. Maxx
• Winners
• HomeSense

3
Products

• TJX Companies' major products include womenswear,
  menswear, childrenswear, homewear, gifts,
  lingerie
• Also offer shoes, fine jewelry, and accessories
  at select Marmaxx and Winners locations
• The Homegoods and Homesense segments offer
  giftware, accent furniture, lamps, rugs,
  accessories, and seasonal merchandise for the
  home
• Bobs Stores offers family apparel and footwear
  with emphasis on men's clothing, footwear,
  workwear, activewear, and licensed team apparel.

4
Key Facts

• TJX opened its first store in 1977 in Worcester
  and Auburn, Massachusetts.
• In 1995, TJX acquired its biggest competitor,
  Marshalls
• Recent developments
• In 1999 TJX Companies launched AJ Wright in the
  US, and TK Maxx, the European version of T.J.
  Maxx.
• T.J. Maxx opened an official company website in
  November 1999.
• The company purchased the assets of Bobs stores,
  worth 100 million, in October 2003.

5
Top Competitors

• Kohls Corp. (KSS) J.C. Penny Companies Inc.
  (JCP), Sears Roebuck (S), Limited Brands (LTD),
  Target Corp. (TGT), Federated Department Stores
  (FD), May Department Stores (MAY), Saks Inc.
  (SKS), Wal-Mart Stores, Inc. (WMT), Burlington
  Coat Factory (BCF), Ross Stores, Inc. (ROST),
  Dillards Inc. (DDS)
• Competitive Advantages
• Cost Advantages- Buy left over products at huge
  discounts. Also buy products overseas. The
  companys stores focus more on functionality
  rather than appeal, which in turn has enabled the
  company to keep its costs down.
• Barriers to entry- TJX Companies core business
  model for off-price retailing of apparel simply
  is the best. Over the past several years no other
  company has been able to mimick the success TJX
  Companies in the market for off-price retailing
  of apparel.

6
Swot Analysis
7
Pros and Cons

• Pros
• Unique inventory management
• TJX has in place information systems
• Core business model
• Recent trends indicate that consumers have been
  unwilling to pay full prices at mallbased
  department stores that are located in
  inconvenient locations
• Low operating cost structure

8
Pros and Cons

• Cons
• 85 of revenues derived from U.S markets
• Marmaxx segment accounted for nearly 75 of
  companys total revenue FY Ended 2004
• Consumer Cyclical Sector reaching all time high
  in EPS

9
Recent News

• 9/9/04 The TJX Companies, Inc. today announced
  the declaration of a regular quarterly dividend
  on its common stock at the quarterly rate of
  .045 per share payable December 2, 2004, to
  shareholders of record on November 11, 2004.
• 9/15/04 T.J. Maxx Announces Sponsorship for T.J.
  Maxx 2004 Tour of Gymnastics Champions. The 2004
  tour will continue T.J. Maxx's and USA
  Gymnastics' long-standing relationship with
  Special Olympics of America by featuring Team
  T.J. Maxx Special Olympic athletes in all but one
  of the performances nationwide.
• 9/23/04 TJX Cos. launched Web sites for its T.J.
  Maxx and HomeGoods stores Thursday that allow
  customers to buy merchandise online.
• 10/7/04 For the 35 weeks ended October 2, 2004,
  sales reached 9.3 billion, a 14 increase over
  last year's 8.2 billion.
• 10/7/04 Same-store sales (stores open at least a
  year) rose just 1 percent in September as
  hurricanes hit the U.S. Southeast.

10
Analyst Recommendation

• Hold