TJX Cos. Inc. (NYSE:TJX)

Current Ratio Trend

The current ratio displays a general decreasing trend from an initial level of 2.2 to values hovering around 1.16 to 1.23 in the most recent periods. Notably, there is a significant drop from 2.2 in early 2020 to approximately 1.17 by late 2022. From that point forward, the ratio stabilizes slightly above 1.15, indicating a moderate level of short-term liquidity throughout the latest quarters. The stability in recent data suggests a consistent approach to managing current assets relative to current liabilities.

Quick Ratio Trend

The quick ratio shows a more pronounced decline over the periods analyzed, starting near 0.96 and descending to levels between 0.35 and 0.59 through 2022 and early 2023. There was a noticeable trough around late 2022 and early 2023, with the ratio reaching as low as 0.35, indicating reduced liquidity in highly liquid assets excluding inventory. Subsequently, the quick ratio exhibits some volatility but remains below the initial values, fluctuating mostly in the range of 0.42 to 0.59. This pattern points to a reduction in the most liquid current assets over time, with intermittent recoveries.

Cash Ratio Trend

The cash ratio follows a trajectory similar to that of the quick ratio, beginning close to 0.92 and undergoing a decline to values as low as 0.3 in late 2022. Post this decline, some improvement is observed, with values generally stabilizing between 0.37 and 0.54 in subsequent quarters. This indicates a contraction in immediate cash and cash equivalents relative to current liabilities during the earlier part of the timeframe, followed by modest recovery efforts. Overall, the cash ratio remains substantially lower than the initial period, underscoring tighter cash buffers.

Liquidity Insights

The analysis of liquidity ratios collectively reveals a tightening in short-term liquidity over the observed periods. The current ratio, though declining, maintains a level generally above 1.1, suggesting that current assets still comfortably exceed current liabilities. However, both the quick and cash ratios reveal reductions in the more liquid components of current assets, which might imply increased reliance on inventory or slower conversion of assets into cash. The partial rebounds in quick and cash ratios in recent quarters could reflect strategic adjustments to liquidity management or changing operational circumstances.

Overall Summary

In summary, the liquidity profile shows a clear downward trend from 2020 through late 2022, followed by a period of relative stabilization with modest fluctuations. This pattern suggests more conservative liquidity positioning in earlier periods transitioning to steady but restrained liquidity management in recent times. The company appears to maintain sufficient current assets relative to liabilities but with diminishing levels of highly liquid assets, which could impact flexibility in addressing immediate financial obligations.

Current Assets

The current assets showed a fluctuating trend throughout the periods analyzed. Initially, there was a notable increase from approximately 10,296 million USD to a peak around 16,654 million USD in late 2020. Following this peak, current assets decreased and oscillated around the 12,000 to 14,000 million USD range in subsequent quarters, indicating some volatility but maintaining a level generally above the early 2020 figures. Towards the latest periods, current assets demonstrated moderate recovery, reaching about 13,278 million USD by mid-2025.

Current Liabilities

Current liabilities exhibited a significant upward movement early in the timeline, climbing from approximately 4,670 million USD to a peak of around 11,817 million USD by late 2020. After peaking, liabilities fluctuated but remained comparatively elevated, generally oscillating between 10,000 and 12,000 million USD across the subsequent periods. This suggests an increased short-term obligations level that persisted through the years analyzed without a marked reduction towards the end.

Current Ratio

The current ratio, reflecting liquidity, declined sharply from 2.2 at the beginning of the period to approximately 1.41 by late 2020. After this sharp drop, the ratio stabilized, fluctuating narrowly around 1.2 across the remaining periods. This pattern indicates a reduction in liquidity adequacy from a strong position early in 2020 to a more moderate but stable range thereafter, suggesting tighter short-term financial flexibility but no significant deterioration subsequently.

Overall Analysis

The initial surge in current assets and liabilities in 2020 suggests aggressive operational or financial changes, possibly related to external economic conditions. The following stabilization of both current assets and liabilities, coupled with a relatively stable current ratio near 1.2, implies the company adjusted to a new normalized liquidity position. The current ratio remaining above 1 consistently indicates the company maintains sufficient short-term asset coverage to meet its liabilities despite tighter liquidity compared to the early 2020 period.

The analysis of the quarterly financial data reveals notable trends in the liquidity position of the company, particularly through its total quick assets, current liabilities, and resulting quick ratio over the observed periods.

Total Quick Assets

Total quick assets exhibited a fluctuating trend, starting at 4,460 million USD and increasing sharply to a peak of 11,046 million USD by October 2020. Following this peak, a general downward movement occurred, with occasional recoveries. Notably, quick assets fell to their lowest point of 3,936 million USD in October 2022 before partially rebounding above 5,800 million USD by August 2024. Overall, quick assets showed volatility with a tendency to decrease after the mid-2020 high.

Current Liabilities

Current liabilities followed a more consistent upward trajectory throughout the periods, beginning at 4,670 million USD and reaching over 12,000 million USD at multiple points, such as October 2024. While there were minor fluctuations, the general drift indicates growing short-term obligations. The peak liability recorded was 12,017 million USD in October 2024, reflecting increased current debt or payables over time.

Quick Ratio

The quick ratio experienced a downward trend over the observed timeline. Initially close to parity at 0.96 in May 2020, it declined steadily to lows around 0.35-0.42 during late 2022 and early 2023, indicating reduced coverage of current liabilities by quick assets. Some recovery was observed thereafter, with the ratio rising to approximately 0.59 by early 2024 but not returning to levels close to or above 1.0. This persistent quick ratio below 1.0 suggests the company may face liquidity pressure since its most liquid assets are insufficient to cover immediate liabilities fully for extended periods.

In summary, the data reflect a period of increased financial strain on liquidity, characterized by rising current liabilities and a declining quick ratio despite some fluctuations and short-term improvements. The decline in quick assets alongside the persistent increase in current liabilities underlines a potentially challenging environment for meeting short-term obligations purely from liquid assets.

The analysis of the quarterly financial data reveals several key trends related to liquidity and short-term obligations over the observed periods.

Total Cash Assets

Total cash assets initially showed a significant increase from approximately 4.3 billion US dollars to a peak exceeding 10.5 billion US dollars within the first year. However, after this peak, there was a general declining trend with fluctuations. The cash balance dropped steadily through mid-2022, reaching lows near 3.3 billion US dollars by late 2022. Subsequently, cash assets experienced intermittent recoveries, ranging roughly between 4.3 and 5.6 billion US dollars through 2023 and into 2024, followed by a moderate decrease towards mid-2025, ending near 4.6 billion US dollars.

Current Liabilities

Current liabilities demonstrated a consistent upward trend over the quarters, starting around 4.7 billion US dollars and increasing to surpass 11.6 billion US dollars by late 2024. Throughout the periods, liabilities fluctuated but maintained an overall rise, indicating growing short-term obligations. The highest recorded liabilities were close to 12.0 billion US dollars by late 2024 and early 2025.

Cash Ratio

The cash ratio, reflecting liquidity by comparing cash assets to current liabilities, generally exhibited a declining trend over the timeframe. Initially near parity at approximately 0.92, the ratio dropped, reaching its lowest points around 0.30 by late 2022. Although there were temporary improvements to values near 0.54 in early to mid-2023 and early 2024, the overall trend points to reduced liquidity relative to short-term liabilities, with ratios hovering around 0.39 to 0.50 in the latest quarters. This suggests a tightening in immediate liquidity cushions despite some fluctuations.

In summary, while total cash assets experienced volatility with an early peak and subsequent declines, current liabilities continuously increased, exerting pressure on liquidity. The decreasing cash ratio underscores a weakening short-term liquidity position over time, which may warrant closer monitoring to ensure sufficient cash coverage of current liabilities moving forward.