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TJX Earnings Upcoming -- Will Tariffs Hurt Guidance?

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With earnings coming up on August 20, TJX (TJX) investors will be anxious to figure out how much a potential 10% to 25% additional tariff on apparel coming into the U.S. from China would impact  future earnings. 

The answer? Not much. 

That' according to D.A. Davidson & Co. analysts. 

"Given the indiscriminate sector sell-off, we would be buyers of the off-pricers (BURL) and TJX," the analysts wrote in a note out when TJX and Burlington were down roughly 5% from July 31, the last day of trading before Trump made the tariff threat. Now, TJX is down 2.5% since July 31, so a solid earnings report could lift the stock considerably. 

The analysts said TJX brands don't source much of their products from China, when compared to PVH (PVH) a brand apparel maker. 

Plus, off-priced players like TJX could buy inventory from full-priced players that see supply chain disruption and higher cost of revenue as a result of the tariffs. "If anything, off-price retailers could benefit from tariff disruption, which can free-up buying opportunity from the full-price channel due to inventory disruptions," Davidson said. 

Investors may want to tune into TJX management's commentary on how tariffs would impact the company on the August 20 earnings call

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