Stock Analysis on Net

TJX Cos. Inc. (NYSE:TJX)

Financial Reporting Quality: Aggregate Accruals 

Microsoft Excel

Earnings can be decomposed into cash and accrual components. The accrual component (aggregate accruals) has been found to have less persistence than the cash component, and therefore (1) earnings with higher accrual component are less persistent than earnings with smaller accrual component, all else equal; and (2) the cash component of earnings should receive a higher weighting evaluating company performance.


Balance-Sheet-Based Accruals Ratio

TJX Cos. Inc., balance sheet computation of aggregate accruals

US$ in millions

Microsoft Excel
Feb 1, 2025 Feb 3, 2024 Jan 28, 2023 Jan 29, 2022 Jan 30, 2021 Feb 1, 2020
Operating Assets
Total assets 31,749 29,747 28,349 28,461 30,814 24,145
Less: Cash and cash equivalents 5,335 5,600 5,477 6,227 10,470 3,217
Operating assets 26,414 24,147 22,872 22,235 20,344 20,928
Operating Liabilities
Total liabilities 23,356 22,445 21,985 22,458 24,981 18,197
Less: Current portion of long-term debt 500 750
Less: Long-term debt, excluding current portion 2,866 2,862 2,859 3,355 5,333 2,237
Operating liabilities 20,490 19,583 18,626 19,104 18,898 15,960
 
Net operating assets1 5,924 4,564 4,246 3,131 1,446 4,968
Balance-sheet-based aggregate accruals2 1,360 318 1,115 1,685 (3,522)
Financial Ratio
Balance-sheet-based accruals ratio3 25.93% 7.22% 30.23% 73.65% -109.84%
Benchmarks
Balance-Sheet-Based Accruals Ratio, Competitors4
Amazon.com Inc. 26.40% 18.01% 32.91% 49.06%
Home Depot Inc. 34.02% -1.45% 15.25% 9.91% 21.77%
Lowe’s Cos. Inc. -2.68% 8.87% -2.92% 2.66% -12.39%
Balance-Sheet-Based Accruals Ratio, Sector
Consumer Discretionary Distribution & Retail 0.00% 20.94% 16.15% 26.47% 31.88%
Balance-Sheet-Based Accruals Ratio, Industry
Consumer Discretionary 0.00% 12.16% 12.17% 12.67% 12.65%

Based on: 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), 10-K (reporting date: 2020-02-01).

1 2025 Calculation
Net operating assets = Operating assets – Operating liabilities
= 26,41420,490 = 5,924

2 2025 Calculation
Balance-sheet-based aggregate accruals = Net operating assets2025 – Net operating assets2024
= 5,9244,564 = 1,360

3 2025 Calculation
Balance-sheet-based accruals ratio = 100 × Balance-sheet-based aggregate accruals ÷ Avg. net operating assets
= 100 × 1,360 ÷ [(5,924 + 4,564) ÷ 2] = 25.93%

4 Click competitor name to see calculations.

Financial ratio Description The company
Balance-sheet-based accruals ratio Ratio is found by dividing balance-sheet-based aggregate accruals by average net operating assets. Using the balance-sheet-based accruals ratio, TJX Cos. Inc. deteriorated earnings quality from 2024 to 2025.

Cash-Flow-Statement-Based Accruals Ratio

TJX Cos. Inc., cash flow statement computation of aggregate accruals

US$ in millions

Microsoft Excel
Feb 1, 2025 Feb 3, 2024 Jan 28, 2023 Jan 29, 2022 Jan 30, 2021 Feb 1, 2020
Net income 4,864 4,474 3,498 3,283 90 3,272
Less: Net cash provided by operating activities 6,116 6,057 4,084 3,057 4,562 4,067
Less: Net cash used in investing activities (2,477) (1,717) (1,470) (1,046) (579) (1,462)
Cash-flow-statement-based aggregate accruals 1,225 134 884 1,272 (3,893) 668
Financial Ratio
Cash-flow-statement-based accruals ratio1 23.36% 3.04% 23.97% 55.57% -121.39%
Benchmarks
Cash-Flow-Statement-Based Accruals Ratio, Competitors2
Amazon.com Inc. 16.87% -2.63% -8.54% 48.44%
Home Depot Inc. 32.13% -3.12% 14.43% 8.24% 14.26%
Lowe’s Cos. Inc. -4.80% 7.91% -4.62% -0.14% -17.28%
Cash-Flow-Statement-Based Accruals Ratio, Sector
Consumer Discretionary Distribution & Retail 0.00% 13.19% 0.41% -4.02% 29.06%
Cash-Flow-Statement-Based Accruals Ratio, Industry
Consumer Discretionary 0.00% 9.69% 4.57% 1.83% 11.33%

Based on: 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), 10-K (reporting date: 2020-02-01).

1 2025 Calculation
Cash-flow-statement-based accruals ratio = 100 × Cash-flow-statement-based aggregate accruals ÷ Avg. net operating assets
= 100 × 1,225 ÷ [(5,924 + 4,564) ÷ 2] = 23.36%

2 Click competitor name to see calculations.

Financial ratio Description The company
Cash-flow-statement-based accruals ratio Ratio is found by dividing cash-flow-statement-based aggregate accruals by average net operating assets. Using the cash-flow-statement-based accruals ratio, TJX Cos. Inc. deteriorated earnings quality from 2024 to 2025.