An In-Depth Look at TJX Companies Inc's Upcoming Dividend and Historical Performance
TJX Companies Inc (TJX, Financial) recently announced a dividend of $0.38 per share, payable on June 6, 2024, with the ex-dividend date set for May 15, 2024. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's look into TJX Companies Inc's dividend performance and assess its sustainability.
What Does TJX Companies Inc Do?
TJX Companies Inc is the leading off-price retailer of apparel, accessories, and home merchandise in the United States. The firm leverages its more than 21,000 global vendor relationships to procure and sell brand-name merchandise at prices 20%-60% cheaper than conventional retail channels. TJX opportunistically purchases excess inventory that stems from manufacturing overruns and retail closeout sales. The off-price retailer disperses its vast and disparate merchandise across its 4,950 global stores, creating a treasure-hunt shopping experience for consumers. Over three quarters of TJX's sales are derived from the United States, primarily via the T.J. Maxx, Marshalls, and HomeGoods banners. About 10% of sales are from Canada and 12% from Europe and Australia.
A Glimpse at TJX Companies Inc's Dividend History
TJX Companies Inc has maintained a consistent dividend payment record since 1986. Dividends are currently distributed on a quarterly basis.
Breaking Down TJX Companies Inc's Dividend Yield and Growth
As of today, TJX Companies Inc currently has a 12-month trailing dividend yield of 1.34% and a 12-month forward dividend yield of 1.51%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, TJX Companies Inc's annual dividend growth rate was 77.80%. Extended to a five-year horizon, this rate decreased to 15.60% per year. And over the past decade, TJX Companies Inc's annual dividends per share growth rate stands at an impressive 13.90%. Based on TJX Companies Inc's dividend yield and five-year growth rate, the 5-year yield on cost of TJX Companies Inc stock as of today is approximately 2.77%.
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one needs to evaluate the company's payout ratio. The dividend payout ratio provides insights into the portion of earnings the company distributes as dividends. A lower ratio suggests that the company retains a significant part of its earnings, thereby ensuring the availability of funds for future growth and unexpected downturns. As of January 31, 2024, TJX Companies Inc's dividend payout ratio is 0.34. TJX Companies Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks TJX Companies Inc's profitability 9 out of 10 as of January 31, 2024, suggesting good profitability prospects. The company has reported positive net income for each year over the past decade, further solidifying its high profitability.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. TJX Companies Inc's growth rank of 9 out of 10 suggests that the company's growth trajectory is good relative to its competitors. Revenue is the lifeblood of any company, and TJX Companies Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. TJX Companies Inc's revenue has increased by approximately 20.90% per year on average, a rate that outperforms approximately 82.68% of global competitors. The company's 3-year EPS growth rate showcases its capability to grow its earnings, a critical component for sustaining dividends in the long run. During the past three years, TJX Companies Inc's earnings increased by approximately 144.60% per year on average, a rate that outperforms approximately 96.35% of global competitors. Lastly, the company's 5-year EBITDA growth rate of 15.40%, which outperforms approximately 64.72% of global competitors.
Conclusion
The analysis of TJX Companies Inc's dividend payments, growth rates, payout ratio, profitability, and growth metrics indicates a robust financial health and promising future prospects. These factors make TJX an attractive option for value investors seeking sustainable dividend income. For those looking to explore further, GuruFocus Premium provides tools such as the High Dividend Yield Screener to discover other high-performing dividend stocks.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
