Core Viewpoint - The article discusses the author's positive outlook on The TJX Companies (TJX), highlighting the potential for the company to exceed its FY25 guidance and drive multiples [1]. Group 1: Investment Strategy - The author emphasizes a diverse investment approach, incorporating fundamental, technical, and momentum investing strategies to enhance their investment process [1]. Group 2: Purpose of Writing - The article serves as a platform for tracking the performance of investment ideas and connecting with like-minded investors [1].

Core Insights - Off-price retail is gaining momentum as consumers remain price-conscious amid economic uncertainty, benefiting companies like TJX and Burlington [1][2] Group 1: Company Performance - TJX Companies benefits from a flexible off-price model, allowing rapid sourcing of quality branded merchandise, enhancing customer loyalty through a treasure-hunt shopping experience [3] - In Q3 of fiscal 2026, TJX reported a 5% increase in comparable sales, with positive performance across all divisions, indicating strong demand [4] - Burlington's total sales rose 7% to $2,706 million in Q3 of fiscal 2025, driven by solid demand and improved merchandising execution [7] Group 2: Expansion Plans - TJX aims to expand its store footprint to 7,000 locations globally, currently operating 5,191 stores, with plans to enter the Spanish market [5] - Burlington operated 1,211 stores at the end of Q3 and plans to open 104 net new stores in fiscal 2025 and at least 110 in 2026, supported by strong new-store performance [9] Group 3: Profitability and Margins - TJX faces margin pressures due to rising operating costs, with SG&A expenses increasing in Q3 of fiscal 2026 [6] - Burlington expanded its adjusted EBIT margin by 60 basis points in Q3, with adjusted EPS climbing 16% to $1.80, reflecting effective expense management [8] Group 4: Market Position and Valuation - TJX is viewed as a steadier off-price option, with stronger comparable sales and a global footprint, while Burlington's results show risks tied to weather sensitivity affecting sales [10][11] - TJX trades at a forward P/E ratio of 30.95x, above the industry average of 29.39x, while Burlington trades at a lower multiple of 26.46x [17] - Over the past year, TJX has gained 27.9%, outperforming the industry's 2.5% growth, while Burlington experienced a slight decline of 1.7% [18] Group 5: Overall Outlook - Both companies are well-positioned to benefit from sustained demand for value-oriented retail, but TJX currently offers greater visibility and a more balanced risk-reward profile [21]

Economic Overview - The US economy is characterized by a K-shaped recovery, with a widening divide between economic haves and have-nots, particularly affecting middle-income consumers due to a softening labor market and inflation fears [1][2]. Consumer Sentiment - As of November, the unemployment rate reached a four-year high of 4.6%, with nearly two-thirds of respondents in a consumer sentiment survey expecting unemployment to rise in the coming year [2]. - Consumer sentiment remains nearly 30% below December 2024 levels, primarily driven by financial concerns [2]. Consumer Spending Trends - Spending among consumers in the top third of the income distribution increased by 4% year-over-year in November, marking the fastest growth in four years, while spending from the lowest third rose by less than 1% [3][4]. - The divergence in consumer spending reflects the K-shaped economic dynamic, with higher-income households benefiting from stock market gains [4]. Retail Sector Performance - Retailers focusing on value and low prices, such as Walmart and TJX, reported strong performance and outperformed the S&P 500 [6]. - Economic uncertainty has led to an influx of higher-income shoppers at dollar store chains, indicating a shift in consumer behavior towards frugality [8]. Consumer Behavior Insights - Analysts note that consumers, particularly in the middle and lower income brackets, are under significant pressure and are prioritizing basic and essential needs [7]. - Walmart described US consumers as "choiceful," reflecting a trend towards more selective spending [8].

Core Insights - The TJX Companies is leveraging its treasure-hunt shopping experience during the holiday season, starting the fiscal fourth quarter on a solid footing with strong access to branded merchandise [1][8] - Frequent new product introductions aim to create a sense of discovery, encouraging repeat visits from shoppers [2][4] - The company emphasizes everyday value pricing and a broad assortment of giftable merchandise, reducing reliance on event-driven promotions [3][4] Product Strategy - TJX plans to introduce new products several times a week throughout the holiday period, ensuring that shoppers encounter fresh assortments [2] - The company is focusing on a wide range of giftable items across various brands and price points to cater to different shopper budgets [4] Competitive Positioning - Compared to Walmart, which emphasizes value and assortment breadth, TJX maintains a unique approach by not relying on event-driven promotions [5] - Dollar Tree is also enhancing its value proposition through an expanded multi-price assortment and frequent product newness, positioning itself to attract value-focused shoppers [6] Financial Performance - TJX shares have increased by 5.2% in the past month, outperforming the industry growth of 2.1% [7] - The company trades at a forward price-to-earnings ratio of 31.09X, higher than the industry average of 29.54X [9] - The Zacks Consensus Estimate indicates year-over-year earnings growth of 9.4% for fiscal 2026 and 8.9% for fiscal 2027 [10]

Group 1: Investment Performance - Qualivian Investment Partners outperformed the iShares MSCI USA Quality Factor ETF by 69.2% and 61.3% on a gross and net basis since inception through September 30, 2025 [1] - The fund also exceeded the S&P 500 by 32.7% and 26.1% respectively, on a gross and net basis [1] Group 2: Company Highlight - The TJX Companies, Inc. - The TJX Companies, Inc. had a one-month return of 2.75% and a 52-week gain of 26.80% [2] - As of December 22, 2025, The TJX Companies, Inc. stock closed at $156.58 per share, with a market capitalization of $173.88 billion [2] Group 3: Market Context and Sector Performance - The S&P 500's Q3 2025 performance was driven by investment in Artificial Intelligence and the Federal Reserve's first interest rate cut since 2024, which increased investor risk appetite [3] - Information Technology and Communication Services sectors led due to AI-related growth, while defensive sectors like Consumer Staples and Healthcare lagged [3] Group 4: Hedge Fund Interest - The TJX Companies, Inc. was held by 69 hedge fund portfolios at the end of Q3 2025, down from 73 in the previous quarter [4] - While The TJX Companies, Inc. is recognized for its investment potential, certain AI stocks are considered to offer greater upside potential with less downside risk [4]

Summary of U.S. Consumer Strategy & Quantitative Research Webinar Industry Overview - The focus is on the U.S. Consumer sector, specifically Consumer Discretionary and Consumer Staples, which have underperformed the market by low double-digit percentages year-to-date in 2025 [3][18]. Core Insights and Arguments - **Market Performance**: 2025 has been challenging for the Consumer sector, with both Discretionary and Staples underperforming. Consumer Staples are now seen as attractive due to favorable price-to-forward earnings valuation multiples [3][31]. - **Sector Dynamics**: There is a contrasting performance between Consumer Staples and technology sectors, raising concerns about a potential tech bubble. Economic factors such as cutbacks in healthcare and SNAP benefits for low-income consumers, alongside inflation, could lead to an economic slowdown [4][19]. - **Investment Recommendations**: Focus on Consumer stocks that are: 1. More international 2. Exposed to higher-income consumers 3. Defensive in nature 4. Not facing idiosyncratic pressures that are not fully priced in [3][22]. - **Key Themes**: Tariff volatility, GLP-1 drug uptake, and consumer bifurcation are critical themes to monitor. Lower-income households are pressured by cutbacks, while higher-income households may benefit from upcoming tax breaks [5][20]. Subsector Recommendations - **Consumer Staples**: Emphasis on companies with international exposure in Soft Beverages and Household & Personal Care, as well as defensive Broadline Retailers. Caution is advised around companies negatively impacted by GLP-1 drug uptake [6][22]. - **Consumer Discretionary**: Focus on higher-quality names with reliable earnings performance. Caution is advised for those without a quality bias, although companies catering to higher-income consumers may benefit from tax breaks in 2026 [6][22]. Performance Metrics - **Consumer Discretionary**: - Best performers include Casinos (23.7%), Apparel Retail (22.7%), and Automotive Retail (19.1%). Weakest sectors include Textiles, Apparel, and Luxury Goods (2.1%) [27][28]. - **Consumer Staples**: - Dollar Stores (49.5%) and Tobacco (29.8%) are leading, while Food Producers (-7.3%) and Alcoholic Beverages (-28.6%) are lagging [29][30]. Valuation Insights - **Valuation Multiples**: Discretionary multiples are about 10% cheaper than historical averages, while Staples are in line with historical averages despite underperformance [31][32]. - **Stock Performance Drivers**: In 2025, multiple expansion has driven stock performance more than earnings growth in both sectors [44]. Earnings Revisions - **Sales Expectations**: Remained stable across consumer discretionary sectors, while earnings per share revisions have shown significant dispersion, particularly declining in textiles and luxury goods due to tariff impacts [51][52]. Conclusion - The current environment is characterized by significant sector rotation and stock-picking opportunities. Analysts recommend focusing on high-quality, defensive stocks with international exposure as the market navigates through economic uncertainties and potential sector shifts [21][22].

Core Viewpoint - TJX Companies Inc. is recognized as a strong investment opportunity by hedge funds, with UBS reiterating a Buy rating due to the company's significant market share gains against department stores [1][2]. Group 1: Market Performance - TJX has been a major share gainer in sales and EBIT dollars against department stores for over a decade, with a particularly strong performance in the third quarter [2]. - Bernstein SocGen Group has also rated TJX as an Outperform with a price target of $155, following positive insights from meetings with senior management [3]. Group 2: Growth Projections - Bernstein anticipates a 13% compound annual growth rate for TJX from 2021 to 2025, highlighting the company's potential to accelerate earnings growth despite challenges such as tariffs and consumer uncertainty [4]. Group 3: Dividend Commitment - TJX has announced a quarterly dividend of $0.425, which will be payable on March 5, 2026, marking 46 consecutive years of dividend payments, with an annual dividend yield of 1.11% [4]. Group 4: Company Overview - TJX Companies, Inc. is the world's leading off-price retailer, offering brand-name apparel and home goods at prices 20% to 60% lower than department stores, operating brands like T.J. Maxx, Marshalls, HomeGoods, and Sierra [5].

Core Insights - Retail stocks are sensitive to economic shifts, yet major retailers like TJX Companies, Walmart, and Dollar General have shown resilience across various economic cycles [1][7] Group 1: Company Performance - TJX has outperformed the S&P 500 for the last two years and has delivered consistent gains for over 15 years, maintaining its position as a leader in off-price apparel and home goods [3][5] - Walmart, the world's largest retailer by revenue, has seen its stock price rise significantly from $58.52 to $116.70 following a stock split, and is expanding into AI shopping through a partnership with OpenAI [4][5] - Dollar General's stock has rebounded by 75% in 2025 after a 70% decline in the previous two years, with plans to open 450 new locations in 2026 [6][5] Group 2: Investment Considerations - Investors with $500 available for investment may consider buying stocks from TJX, Walmart, or Dollar General, as all three companies have demonstrated adaptability to changing consumer spending patterns [1][7]

Core Insights - TJX has outperformed the S&P 500 with a 28% gain this year and a 129% return over the past five years, driven by its discount retail model [1][2] - The company's primary brands, T.J. Maxx and Marshalls, are crucial for its success, contributing approximately 60% of total sales in Q3 FY26 [5][3] - Economic conditions favor TJX's business model, attracting consumers seeking low-priced essential products during downturns [9][10] Financial Performance - The U.S. Marmaxx division grew by 7% year over year, while Canadian and international segments increased by 8% and 9% year over year, respectively [7] - Comparable sales for the parent company increased by 5%, indicating customer loyalty and larger order sizes [8] Market Trends - The growing trend of clothing reselling, particularly among Gen Z, presents an opportunity for TJX as consumers buy and resell discounted items [11] - The company is positioned well for continued growth into 2026, especially if comparable sales and revenue maintain their upward trajectory [12]

Core Viewpoint - BJ's Wholesale Club is facing challenges in growth and competition, while TJX Companies presents a more attractive long-term investment opportunity due to its strong performance and adaptability in uncertain economic conditions [1][3]. BJ's Wholesale Club - BJ's stock is currently priced at $94.66 with a market cap of $12 billion and a year-to-date increase of 5% [2]. - The company reported a modest sales increase of 1.1% in the third quarter and 0.8% for the first nine months of fiscal year 2025 compared to the previous year [6]. - BJ's faces competition from larger players like Costco and Walmart, lacking the scale and international presence that these competitors have [7]. - The company operates fewer than 300 stores, primarily on the East Coast, which limits its market reach [7]. TJX Companies - TJX has seen a significant year-to-date stock increase of nearly 30% and has exceeded sales and margin expectations in its latest quarter [7]. - The company has raised its guidance for the upcoming year and anticipates a strong holiday season [7]. - TJX operates under an off-price retail model, which is particularly appealing in times of economic uncertainty as consumers seek discounts [9]. - The company reported a 1% increase in gross profit margins from the previous year's third quarter, indicating strong financial health [10].