Analysis of Debt
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TJX Cos. Inc. pages available for free this week:
- Common-Size Balance Sheet: Assets
- Analysis of Profitability Ratios
- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Analysis of Reportable Segments
- Analysis of Geographic Areas
- Enterprise Value to EBITDA (EV/EBITDA)
- Return on Assets (ROA) since 2005
- Analysis of Revenues
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Total Debt (Carrying Amount)
TJX Cos. Inc., balance sheet: debt
US$ in millions
Based on: 10-K (reporting date: 2026-01-31), 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).
The carrying amount of total long-term debt exhibited a significant decline over the observed period. Initially reported at US$6,083 million as of January 30, 2021, the figure decreased substantially to US$2,869 million by January 31, 2026. This reduction was not linear, with fluctuations occurring in the interim.
- Overall Trend
- A clear downward trend in total long-term debt is evident. The most substantial decrease occurred between January 30, 2021, and January 29, 2022, with a reduction of US$2,728 million. Subsequent declines were more moderate.
- Current Portion of Long-Term Debt
- The current portion of long-term debt showed variability. It began at US$750 million in January 2021, decreased to US$500 million in January 2023, and then increased significantly to US$999 million by January 2026. The absence of reported values for 2022 and 2024 introduces uncertainty regarding short-term debt management during those periods.
- Long-Term Debt (Excluding Current Portion)
- Long-term debt, excluding the current portion, also decreased over the period, though at a less dramatic rate than the overall total. Starting at US$5,333 million in January 2021, it fell to US$1,870 million by January 2026. The decline was relatively consistent, with minor fluctuations between 2022 and 2024, remaining around US$2,859-US$2,866 million.
The consistent reduction in long-term debt, excluding the current portion, suggests a deliberate strategy to decrease reliance on long-term financing. The increase in the current portion of long-term debt in the final reported year may indicate a shift in debt maturity profiles or a planned refinancing strategy. Further investigation into the company’s debt repayment schedule and financing activities would be necessary to fully understand these movements.
Total Debt (Fair Value)
| Jan 31, 2026 | |
|---|---|
| Selected Financial Data (US$ in millions) | |
| Current portion of long-term debt | |
| Long-term debt, exclusive of current portion | |
| Total long-term debt, inclusive of current portion (fair value) | |
| Financial Ratio | |
| Debt, fair value to carrying amount ratio | |
Based on: 10-K (reporting date: 2026-01-31).
Weighted-average Interest Rate on Debt
Weighted-average effective interest rate on debt:
| Interest rate | Debt amount1 | Interest rate × Debt amount | Weighted-average interest rate2 |
|---|---|---|---|
| Total | |||
Based on: 10-K (reporting date: 2026-01-31).
1 US$ in millions
2 Weighted-average interest rate = 100 × ÷ =
Interest Costs Incurred
TJX Cos. Inc., interest costs incurred
US$ in millions
| 12 months ended: | Jan 31, 2026 | Feb 1, 2025 | Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest expense, excluding capitalized interest | |||||||||||||
| Capitalized interest | |||||||||||||
| Interest expense |
Based on: 10-K (reporting date: 2026-01-31), 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).
Interest expense exhibited a declining trend over the analyzed period. Total interest expense, encompassing both expense recognized currently and capitalized interest, decreased from US$199 million in January 2021 to US$79 million in January 2026. The reduction is primarily driven by a substantial decrease in interest expense excluding capitalized interest, while capitalized interest fluctuated modestly.
- Interest Expense Excluding Capitalized Interest
- A consistent downward trajectory is observed in interest expense excluding capitalized interest. Beginning at US$194 million in January 2021, it decreased to US$74 million by January 2026, representing a reduction of approximately 62%. The most significant decline occurred between January 2021 and January 2022, followed by more gradual decreases in subsequent years.
- Capitalized Interest
- Capitalized interest demonstrated more variability. It started at US$5 million in January 2021, decreased to US$3 million in February 2024, then increased to US$5 million in January 2026. The fluctuations suggest potential changes in projects under development where interest is eligible for capitalization, or changes in capitalization policies.
- Total Interest Expense
- Total interest expense mirrored the trend of the larger component, decreasing from US$199 million in January 2021 to US$79 million in January 2026. The rate of decline slowed in the later years of the period, indicating the impact of stabilizing interest expense excluding capitalized interest. A slight increase is noted between January 2025 and January 2026, driven by the increase in capitalized interest.
The overall reduction in interest expense suggests either a decrease in outstanding debt, lower interest rates on existing debt, or a combination of both. Further investigation into the company’s debt structure and borrowing rates would be necessary to determine the primary drivers of this trend.
Adjusted Interest Coverage Ratio
Based on: 10-K (reporting date: 2026-01-31), 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).
2026 Calculations
1 Interest coverage ratio (without capitalized interest) = EBIT ÷ Interest expense, excluding capitalized interest
= ÷ =
2 Adjusted interest coverage ratio (with capitalized interest) = EBIT ÷ Interest expense
= ÷ =
The interest coverage ratios demonstrate a significant and consistent improvement over the observed period. Both the standard interest coverage ratio and the adjusted interest coverage ratio, which incorporates capitalized interest, exhibit strong upward trends.
- Interest Coverage Ratio (without capitalized interest)
- The interest coverage ratio (without capitalized interest) begins at 1.46 in 2021. A substantial increase is then observed, rising to 37.80 in 2022, 56.19 in 2023, 76.53 in 2024, 86.30 in 2025, and culminating at 99.64 in 2026. This indicates a markedly improved ability to meet interest obligations from earnings before interest and taxes (EBIT) without considering the impact of capitalized interest.
- Adjusted Interest Coverage Ratio (with capitalized interest)
- The adjusted interest coverage ratio, which includes the effect of capitalized interest, follows a similar pattern. Starting at 1.42 in 2021, it increases to 36.67 in 2022, 51.87 in 2023, 73.73 in 2024, 84.09 in 2025, and reaches 93.33 in 2026. While lower than the standard interest coverage ratio at each point in time due to the inclusion of capitalized interest, the trend remains strongly positive.
- Comparative Analysis
- The difference between the two ratios remains relatively consistent throughout the period, suggesting that the amount of capitalized interest is stable as a proportion of total interest expense. The substantial increases in both ratios indicate a significant improvement in profitability relative to interest expense. The ratios suggest a decreasing risk of being unable to meet interest payments.
The consistent and substantial growth in both interest coverage ratios suggests a strengthening financial position and improved capacity to service debt obligations over the analyzed timeframe.