Ed Ponsi

A Retailer That’s About to Take Off

Online retail has exploded during the COVID-19 pandemic. In its just completed quarter, Best Buy (BBY) saw a 154% increase in online sales. Target (TGT) posted a 141% jump, and Wal-Mart (WMT) announced a 74% increase in e-commerce sales.

However, there's no substitute for the in-person shopping experience. That’s especially true when it comes to clothes. You really don’t know how you’ll look until you try it on.

I’m expecting a short-term shift to old fashioned brick and mortar sales. With the U.S. opening up for business, there is pent-up demand for the in-person shopping experience.

While all retailers have an online presence, there are those that focus on in-person sales. One such name is TJX Companies (TJX), parent company of the popular TJ Maxx store chain.

The TJX formula is quality at a reasonable price. The retailer does this by taking advantage of special situations, such as canceled orders. Because of this, shoppers never know exactly what they’ll find, and that’s part of the appeal. It’s like a treasure hunt.

With all the disruption currently occurring in the economy, many order cancellations are bound to occur. Entire chains, some in trouble before the appearance of the virus, might fail to emerge from the anticipated recession.

The coming wave of cancellations will allow TJX to acquire its products at even lower prices. I anticipate an accompanying boost in margins.

TJX’s chart hints that good news is coming. The stock has just broken out of an ascending triangle (black dotted lines). This bullish pattern projects a return for the stock to its 52-week high of $64.95, set in late February. 

TJX
                                                    TJX has broken out from a bullish ascending triangle

There is anecdotal evidence that the above scenario has already started to unfold. When the company released its earnings report last week, it stated the following:

Initial sales overall have been above last year’s sales across all states and countries for the over 1100 stores that have reopened for at least a week.”

We’re buying TJX right here, as the stock’s technicals line up seamlessly with the company’s current bullish situation.

TJX AMZN WMT XRT TGT M DDS AAPL 

Comments (3)
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jenniferduran
jenniferduran

Different objectives call for different types of discounts. For example, if your purpose is customer acquisition, then you’ll probably want to implement more aggressive tactics such as loss leaders or store-wide sales, to attract the most number of people. On the other hand, if you’re looking to re-engage people who have purchased from you in the past, then you’ll want to add a personal touch to your offers and run customized deals. https://essayacademia.com/

The real yep
The real yep

Yep

Ed Ponsi
Ed Ponsi

Editor

Just confirmed there was a line of people waiting to get in at my local TJX when it reopened.