Stock Analysis on Net

TJX Cos. Inc. (NYSE:TJX)

$24.99

Economic Value Added (EVA)

Microsoft Excel

EVA is registered trademark of Stern Stewart.

Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.

Paying user area


We accept:

Visa Mastercard American Express Maestro Discover JCB PayPal Google Pay
Visa Secure Mastercard Identity Check American Express SafeKey

Economic Profit

TJX Cos. Inc., economic profit calculation

US$ in millions

Microsoft Excel
12 months ended: Feb 1, 2025 Feb 3, 2024 Jan 28, 2023 Jan 29, 2022 Jan 30, 2021 Feb 1, 2020
Net operating profit after taxes (NOPAT)1
Cost of capital2
Invested capital3
 
Economic profit4

Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).

1 NOPAT. See details »

2 Cost of capital. See details »

3 Invested capital. See details »

4 2025 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= × =


The financial data over the six-year period reveals significant fluctuations and overall growth trends in key operational metrics.

Net Operating Profit After Taxes (NOPAT)
The NOPAT exhibits considerable variability, with an initial value of 3,536 million USD in 2020, followed by a sharp decrease to 270 million USD in 2021. This abrupt decline may indicate operational challenges or extraordinary events in that year. Subsequently, there is a strong recovery and consistent growth trend from 2022 onward, reaching 5,082 million USD by 2025. This progression suggests improved operational efficiency and profitability in the latter years.
Cost of Capital
The cost of capital shows a gradual upward trend, increasing from 11.84% in 2020 to 12.90% in 2025. This steady increase may reflect changes in market conditions, risk perceptions, or shifts in the company’s capital structure. The rising cost of capital could exert pressure on investment decisions and financial performance.
Invested Capital
Invested capital initially increases from 18,717 million USD in 2020 to a peak of 22,428 million USD in 2021, followed by a decrease to 19,742 million USD in 2022. From that point forward, invested capital steadily rises again, reaching 22,612 million USD by 2025. The initial increase and subsequent reduction might suggest strategic adjustments in asset deployment or capital expenditures, with the later growth indicating renewed investment efforts.
Economic Profit
Economic profit experiences a pronounced decline in 2021, dropping to negative 2,390 million USD from a positive 1,320 million USD in 2020, which aligns with the observed fall in NOPAT. After 2021, economic profit returns to positive territory and progressively grows to 2,166 million USD by 2025. This pattern demonstrates the recovery in value creation after a challenging year, emphasizing effective capital utilization and improved profitability in recent periods.

In summary, the data reflects a significant disruption or adverse event in 2021 characterized by reduced profitability and negative economic profit. Following this, the company exhibits resilience with a solid recovery and enhanced financial performance from 2022 through 2025, despite facing a gradually increasing cost of capital. The trends in invested capital suggest strategic shifts and increased investments aligned with growth objectives.


Net Operating Profit after Taxes (NOPAT)

TJX Cos. Inc., NOPAT calculation

US$ in millions

Microsoft Excel
12 months ended: Feb 1, 2025 Feb 3, 2024 Jan 28, 2023 Jan 29, 2022 Jan 30, 2021 Feb 1, 2020
Net income
Deferred income tax expense (benefit)1
Increase (decrease) in deferred gift card revenue2
Increase (decrease) in equity equivalents3
Interest expense, excluding capitalized interest
Interest expense, operating lease liability4
Adjusted interest expense, excluding capitalized interest
Tax benefit of interest expense, excluding capitalized interest5
Adjusted interest expense, excluding capitalized interest, after taxes6
Interest income
Investment income, before taxes
Tax expense (benefit) of investment income7
Investment income, after taxes8
Net operating profit after taxes (NOPAT)

Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).

1 Elimination of deferred tax expense. See details »

2 Addition of increase (decrease) in deferred gift card revenue.

3 Addition of increase (decrease) in equity equivalents to net income.

4 2025 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =

5 2025 Calculation
Tax benefit of interest expense, excluding capitalized interest = Adjusted interest expense, excluding capitalized interest × Statutory income tax rate
= × 21.00% =

6 Addition of after taxes interest expense to net income.

7 2025 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= × 21.00% =

8 Elimination of after taxes investment income.


The financial data reveals significant fluctuations and an overall upward trajectory in key profitability measures over the analyzed periods.

Net Income
Net income shows a sharp decline from 3,272 million US dollars in early 2020 to just 90 million in early 2021, indicating a substantial drop in profitability during that period. However, from 2021 onwards, net income exhibited a strong recovery and consistent growth, rising to 3,283 million in early 2022 and steadily increasing each subsequent year to reach 4,864 million by early 2025.
Net Operating Profit After Taxes (NOPAT)
NOPAT follows a similar pattern to net income, with a considerable decrease to 270 million in early 2021 from 3,536 million in early 2020. After this low point, NOPAT experienced a robust rebound and a steady upward trend, increasing to 3,612 million in early 2022 and further climbing to 5,082 million by early 2025.
Trend Analysis
Both net income and NOPAT demonstrate a drastic downturn in the 2021 fiscal period, likely reflecting an extraordinary event or disruption impacting profitability. Following this period, both metrics recover strongly and exhibit sustained growth through to 2025, surpassing pre-2021 levels significantly. This recovery and growth suggest improved operational efficiency or favorable business conditions contributing to enhanced financial performance.

Cash Operating Taxes

TJX Cos. Inc., cash operating taxes calculation

US$ in millions

Microsoft Excel
12 months ended: Feb 1, 2025 Feb 3, 2024 Jan 28, 2023 Jan 29, 2022 Jan 30, 2021 Feb 1, 2020
Provision (benefit) for income taxes
Less: Deferred income tax expense (benefit)
Add: Tax savings from interest expense, excluding capitalized interest
Less: Tax imposed on investment income
Cash operating taxes

Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).


The analysis of the annual financial data reveals notable fluctuations and an overall upward trend in key tax-related metrics over the observed periods.

Provision (benefit) for income taxes
The provision for income taxes displays significant variability across the years. Initially, a positive provision of 1134 million US dollars was observed in early 2020, followed by a sharp decline to a negative amount of 1 million US dollars in early 2021, indicating a tax benefit or reversal during that period. Subsequently, the provision returned to positive values, increasing from 1115 million US dollars in early 2022 to 1138 million in early 2023. The trend continued upward with a marked increase to 1493 million in early 2024 and further to 1619 million in early 2025. This pattern suggests recovery from an anomalous tax benefit year and a strengthening in tax expense recognition thereafter.
Cash operating taxes
Cash operating taxes follow a somewhat parallel trend to the provision for income taxes but with less volatility. There was a decline from 1199 million US dollars in early 2020 to 320 million in early 2021, reflecting a considerable reduction in cash tax payments during that year. From early 2021, cash operating taxes increased notably, reaching 1229 million in early 2022, before slightly decreasing to 1128 million in early 2023. A substantial rise is observed in early 2024 and 2025, climbing to 1532 million and 1628 million, respectively. This rising trend indicates increased cash outflows related to tax obligations in the later periods.

Overall, the data depicts a year of unusual tax benefits or adjustments in 2021, followed by steady increases in both tax provisions and cash taxes, culminating in higher tax expenses and payments by 2024 and 2025. This trend may reflect changes in earnings, tax regulations, or strategic tax planning impacting the company's tax-related financial metrics over the period analyzed.


Invested Capital

TJX Cos. Inc., invested capital calculation (financing approach)

US$ in millions

Microsoft Excel
Feb 1, 2025 Feb 3, 2024 Jan 28, 2023 Jan 29, 2022 Jan 30, 2021 Feb 1, 2020
Current portion of long-term debt
Long-term debt, excluding current portion
Operating lease liability1
Total reported debt & leases
Shareholders’ equity
Net deferred tax (assets) liabilities2
Deferred gift card revenue3
Equity equivalents4
Accumulated other comprehensive (income) loss, net of tax5
Adjusted shareholders’ equity
Invested capital

Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).

1 Addition of capitalized operating leases.

2 Elimination of deferred taxes from assets and liabilities. See details »

3 Addition of deferred gift card revenue.

4 Addition of equity equivalents to shareholders’ equity.

5 Removal of accumulated other comprehensive income.


Total Reported Debt & Leases
The total reported debt and leases increased significantly from 11,464 million USD in early 2020 to a peak of 15,503 million USD in early 2021. Following this peak, the debt level decreased notably to 12,507 million USD in early 2022 and then remained relatively stable around the 12,500 to 12,800 million USD range through early 2025.
Shareholders’ Equity
Shareholders’ equity exhibited a generally upward trend over the period. Starting at 5,948 million USD in 2020, there was a slight decline by early 2021 to 5,833 million USD, followed by a consistent increase thereafter. By early 2025, equity reached 8,393 million USD, marking a significant growth from the initial value.
Invested Capital
Invested capital followed a pattern similar to total debt and leases, rising sharply from 18,717 million USD in 2020 to 22,428 million USD in 2021. Subsequently, it decreased to 19,742 million USD in 2022 and then experienced gradual growth over the following years, reaching 22,612 million USD by 2025. This indicates a period of increased investment around 2021, followed by stabilization and moderate growth.

Cost of Capital

TJX Cos. Inc., cost of capital calculations

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Long-term debt, inclusive of current maturities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2025-02-01).

1 US$ in millions

2 Equity. See details »

3 Long-term debt, inclusive of current maturities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Long-term debt, inclusive of current maturities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2024-02-03).

1 US$ in millions

2 Equity. See details »

3 Long-term debt, inclusive of current maturities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Long-term debt, inclusive of current maturities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2023-01-28).

1 US$ in millions

2 Equity. See details »

3 Long-term debt, inclusive of current maturities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Long-term debt, inclusive of current maturities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2022-01-29).

1 US$ in millions

2 Equity. See details »

3 Long-term debt, inclusive of current maturities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Long-term debt, inclusive of current maturities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2021-01-30).

1 US$ in millions

2 Equity. See details »

3 Long-term debt, inclusive of current maturities. See details »

4 Operating lease liability. See details »

Capital (fair value)1 Weights Cost of capital
Equity2 ÷ = × =
Long-term debt, inclusive of current maturities3 ÷ = × × (1 – 21.00%) =
Operating lease liability4 ÷ = × × (1 – 21.00%) =
Total:

Based on: 10-K (reporting date: 2020-02-01).

1 US$ in millions

2 Equity. See details »

3 Long-term debt, inclusive of current maturities. See details »

4 Operating lease liability. See details »


Economic Spread Ratio

TJX Cos. Inc., economic spread ratio calculation, comparison to benchmarks

Microsoft Excel
Feb 1, 2025 Feb 3, 2024 Jan 28, 2023 Jan 29, 2022 Jan 30, 2021 Feb 1, 2020
Selected Financial Data (US$ in millions)
Economic profit1
Invested capital2
Performance Ratio
Economic spread ratio3
Benchmarks
Economic Spread Ratio, Competitors4
Amazon.com Inc.
Home Depot Inc.
Lowe’s Cos. Inc.

Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).

1 Economic profit. See details »

2 Invested capital. See details »

3 2025 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =

4 Click competitor name to see calculations.


Economic Profit
The economic profit experienced significant fluctuations over the observed periods. Initially, there was a positive value of 1320 million US dollars, followed by a sharp decline to a negative value of -2390 million US dollars in the subsequent year. After this downturn, the economic profit rebounded to positive values, reaching 1232 million US dollars, and showed a steady upward trend thereafter, culminating at 2166 million US dollars in the most recent period. This indicates volatility in profitability but an overall recovery and strengthening position in recent years.
Invested Capital
Invested capital demonstrated a generally increasing trend throughout the periods, starting at 18,717 million US dollars and rising to 22,612 million US dollars by the last period. There was a noticeable increase between the first and second periods, followed by a slight decline in the third period before continuing to grow steadily. This suggests ongoing investments or capital deployments despite some adjustments.
Economic Spread Ratio
The economic spread ratio mirrored the volatility seen in economic profit. Initially positive at 7.05%, it sharply declined to a negative value of -10.66% in the second period, indicating operational or investment inefficiencies during that time. However, the ratio recovered to around 6.24% and 6.28% in the following two periods and then showed significant improvement to 9.27% and 9.58% in the last two periods. This improving ratio points to enhanced value creation and profitability relative to invested capital over time.

Economic Profit Margin

TJX Cos. Inc., economic profit margin calculation, comparison to benchmarks

Microsoft Excel
Feb 1, 2025 Feb 3, 2024 Jan 28, 2023 Jan 29, 2022 Jan 30, 2021 Feb 1, 2020
Selected Financial Data (US$ in millions)
Economic profit1
 
Net sales
Add: Increase (decrease) in deferred gift card revenue
Adjusted net sales
Performance Ratio
Economic profit margin2
Benchmarks
Economic Profit Margin, Competitors3
Amazon.com Inc.
Home Depot Inc.
Lowe’s Cos. Inc.

Based on: 10-K (reporting date: 2025-02-01), 10-K (reporting date: 2024-02-03), 10-K (reporting date: 2023-01-28), 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01).

1 Economic profit. See details »

2 2025 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted net sales
= 100 × ÷ =

3 Click competitor name to see calculations.


Adjusted Net Sales
The adjusted net sales demonstrate an overall upward trend over the analyzed periods. After a decline from 41,768 million USD in 2020 to 32,212 million USD in 2021, sales recovered significantly, reaching 48,659 million USD in 2022 and continuing to increase steadily to 56,411 million USD by 2025. This suggests a strong recovery and growth trajectory in sales revenue post-2021.
Economic Profit
The economic profit fluctuates notably throughout the periods. It started at 1,320 million USD in 2020, decreased sharply to a negative value of -2,390 million USD in 2021, indicating losses or value destruction during that year. It then returned to positive territory with 1,232 million USD in 2022 and showed consistent growth thereafter, reaching 2,166 million USD by 2025. This recovery and subsequent growth in economic profit imply improved operational efficiency or better capital utilization following the 2021 downturn.
Economic Profit Margin
The economic profit margin closely mirrors the pattern observed in economic profit. It declined severely from 3.16% in 2020 to -7.42% in 2021, reflecting the negative economic profit during that year. From 2022 onwards, the margin progressively improved, increasing steadily each year to reach 3.84% by 2025. The margin’s recovery and growth indicate enhanced profitability relative to sales over time.
Overall Trends and Insights
The period under review reveals a significant dip in both sales and profitability metrics in 2021, likely driven by extraordinary or adverse conditions. However, there is a strong rebound from 2022 forward, with adjusted net sales exhibiting considerable growth and economic profit reverting to positive figures and increasing thereafter. The improving economic profit margin further confirms a strengthening financial performance and efficient value generation relative to sales. The data reflects resilience and effective recovery strategies post-2021 challenges leading to stronger and more profitable operations in the subsequent years.