DCF Studio

    TJX · NYQ · Consumer Cyclical

    The TJX Companies, Inc.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 96.72

    Market price

    USD 141.00

    Implied upside

    -31.4%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2026-01-31

    AdjustedCapital expenditure runs at 3.2% of revenue against depreciation of 1.9%. A perpetuity has to be a steady state, so the forecast tapers capex to maintenance at depreciation plus the reinvestment terminal growth requires (g/ROIC of NOPAT), and the terminal year carries on from there. The bridge is shown under Terminal Value.

    Value Per Share

    Perpetuity growth
    USD 96.72-31.4%
    Exit multiple
    USD 131.79-6.5%
    Market price
    USD 141.00

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn4bn7bnFY27FY28FY29FY30FY31FY32FY33FY34FY35FY36
    Nominal FCFFDiscounted to todayUSD
    LineFY27FY28FY29FY30FY31FY32FY33FY34FY35FY36CAGR
    RevenueUSD 64.0bnUSD 68.0bnUSD 71.9bnUSD 75.7bnUSD 79.3bnUSD 82.8bnUSD 86.0bnUSD 89.0bnUSD 91.6bnUSD 93.9bn+4.3%
    EBITUSD 7.0bnUSD 7.4bnUSD 7.8bnUSD 8.2bnUSD 8.6bnUSD 9.0bnUSD 9.4bnUSD 9.7bnUSD 10.0bnUSD 10.2bn+4.3%
    NOPATUSD 5.5bnUSD 5.8bnUSD 6.2bnUSD 6.5bnUSD 6.8bnUSD 7.1bnUSD 7.4bnUSD 7.6bnUSD 7.9bnUSD 8.1bn+4.3%
    Add depreciation & amortisationUSD 1.2bnUSD 1.3bnUSD 1.4bnUSD 1.4bnUSD 1.5bnUSD 1.6bnUSD 1.6bnUSD 1.7bnUSD 1.7bnUSD 1.8bn+4.3%
    Less capital expenditureUSD -2.0bnUSD -2.1bnUSD -2.2bnUSD -2.2bnUSD -2.2bnUSD -2.3bnUSD -2.3bnUSD -2.3bnUSD -2.3bnUSD -2.2bn+1.0%
    Capex, % of revenue3.2%3.1%3.0%2.9%2.8%2.7%2.7%2.6%2.5%2.4%-
    Less increase in working capitalUSD -182.9mUSD -199.6mUSD -196.1mUSD -190.7mUSD -183.1mUSD -173.5mUSD -161.7mUSD -148.0mUSD -132.3mUSD -114.9m-5.0%
    Free cashflow to firmUSD 4.5bnUSD 4.8bnUSD 5.2bnUSD 5.5bnUSD 5.9bnUSD 6.2bnUSD 6.6bnUSD 6.9bnUSD 7.2bnUSD 7.5bn+5.9%
    Discount factor0.96380.89530.83170.77250.71760.66660.61920.57520.53430.4964-
    Present valueUSD 4.3bnUSD 4.3bnUSD 4.3bnUSD 4.3bnUSD 4.2bnUSD 4.2bnUSD 4.1bnUSD 4.0bnUSD 3.9bnUSD 3.7bn-
    Present Value Of The ForecastUSD 41.2bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.723Reported 0.587, pulled toward 1.0 (Blume)
    Cost of equity7.95%Risk-free + beta x equity risk premium
    Cost of debt5.29%Risk-free + 40bp, the spread for a AAA rating at 97.0x interest cover. Book interest / average debt was lower, at 0.6%.
    Market capitalisationUSD 155.1bn92.0% of capital
    Total debtUSD 13.5bn8.0% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC7.65%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 96.72

    65% of EV

    Forecast FCFF, final year
    USD 7.5bn
    Capex at depreciation, working capital in reinvestment
    USD 8.1bn
    Less reinvestment at g/ROIC (5.7% of NOPAT)
    USD -460.2m
    Capitalised
    USD 7.6bn
    ROIC (reported)
    43.8%
    Terminal value, undiscounted
    USD 151.3bn
    Terminal value, discounted
    USD 75.1bn
    Enterprise value
    USD 116.4bn
    Less net debt
    USD 7.3bn
    Equity value
    USD 109.1bn

    Exit at 19.3x EBITDA

    Value per shareUSD 131.79

    74% of EV

    Terminal value, undiscounted
    USD 231.1bn
    Terminal value, discounted
    USD 114.7bn
    Enterprise value
    USD 155.9bn
    Less net debt
    USD 7.3bn
    Equity value
    USD 148.7bn

    Spread between methods: 31%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    5.65%134.34147.00163.75186.89220.89
    6.65%106.12113.24122.13133.50148.55
    7.65%87.1491.4896.71103.11111.09
    8.65%73.5176.3279.6083.5088.20
    9.65%63.2765.1567.3169.8272.77

    Outlined: this model. Green text: above today's price of 141.00. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year6.5%4.5%8.8%
    EBIT margin11.9%10.9%15.4%
    Discount rate-7.7%6.1%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.