TJX: 3 Apparel Stocks Capitalizing on Consumer Trends

The apparel industry is always rapidly adapting to changing consumer trends. The companies with a focus on sustainability, inclusivity, and digital-first shopping experiences are embracing eco-friendly materials and ethical production practices. Such practices are gaining traction among the younger demographics.

Therefore, investors looking to invest in fundamentally strong apparel stocks might consider investing in The TJX Companies, Inc. (TJX), Ralph Lauren Corporation (RL), and H & M Hennes & Mauritz AB (publ) (HNNMY), which are well-positioned for potential gain.

Fashion brands are increasingly adopting environmental and social responsibility into their strategies. By embracing recycled materials, adopting slow fashion, or reducing their carbon footprint, this is how leading brands are taking charge. Thus, companies that align with these values are well-positioned for long-term growth. However, e-commerce continues to dominate the retail landscape as well, with apparel brands leveraging digital platforms to reach a broader audience.

Emerging markets offer significant growth potential for apparel companies. Rising disposable incomes and a growing middle class in regions like Asia and Africa are driving demand for branded apparel. Companies investing in localized strategies are reaping the rewards of this global expansion.

The global apparel market is anticipated to reach $2.26 trillion by 2030, exhibiting a CAGR of 4.1%. According to a Statista report, the number of users in the market is projected to reach 636.20 million by 2029.

With that in mind, let’s evaluate the fundamentals of the featured Fashion & Luxury industry stocks, starting with number three:

Stock #3: The TJX Companies, Inc. (TJX)

TJX is an off-price apparel and home fashions retailer worldwide. The company operates through four segments: Marmaxx; HomeGoods; TJX Canada; and TJX International.

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On December 9, the company declared a quarterly dividend of $0.375 per share, payable on March 6, 2025, to shareholders of record at the close of business on February 13, 2025. TJX pays an annual dividend of $1.50 per share, which translates to a yield of 1.21% on the prevailing share price. The company’s dividend payouts have increased at an impressive CAGR of 11.9% over the past three years. Also, its four-year average dividend yield is 1.30%.

On June 7, TJX entered into an agreement for a joint venture with Grupo Axo, S.A.P.I. de C.V., where TJX would own 49% and Axo would own 51%. The agreement would comprise Axo’s off-price physical store business in Mexico, which includes a total of over 200 stores.

In the fiscal third quarter of 2025 that ended on November 2, TJX’s net sales increased 6% year-over-year to $14.06 billion. It reported income before income taxes of $1.74 billion, indicating a 9.3% growth from the prior-year quarter. The company’s net income amounted to $1.29 million, and its earnings per share came in at $1.14, reflecting increases of 8.9% and 10.7% year-over-year, respectively.

According to the financial guidance for fiscal year 2025, the company’s diluted earnings per share is projected to be between $4.15 and $4.17, with pre-tax profit margin anticipated to be approximately 11.3%.

Analysts expect TJX’s revenue for the first quarter (ending April 2025) to increase 5.6% year-over-year to $13.18 billion, while its EPS for the same period is expected to grow 6.8% from the prior year to $0.99. Moreover, it topped Street revenue and EPS estimates in each of the trailing four quarters, which is excellent.

The stock has surged 29% over the past year and 19.4% over the past nine months to close the last trading session at $121.09.

TJX’s POWR Ratings reflect this robust outlook. The stock has an overall rating of B, which equates to Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.

TJX has a B grade for Momentum, Stability, and Quality. It is ranked #12 out of 59 stocks in the Fashion & Luxury industry. Click here to see the additional ratings for TJX (Growth, Value, and Sentiment).

Stock #2: Ralph Lauren Corporation (RL)

RL is engaged in the design, marketing, and distribution of luxury lifestyle products internationally, including apparel, footwear & accessories, home, fragrances, eyewear, fine jewelry, and hospitality. The company operates through three segments: North America; Europe; and Asia.

On December 13, demonstrating its commitment to returning value to shareholders, the company declared a quarterly dividend of $0.83 per share, payable on January 10, 2025.

RL pays an annual dividend of $3.30, which translates to a yield of 1.44% at the current share price. Its four-year average dividend yield is 1.86%. Moreover, the company’s dividend payouts have increased at an impressive CAGR of 16.1% over the past three years.

For the fiscal 2025 second quarter that ended on September 28, RL’s net revenues increased 5.7% year-over-year to $1.73 billion, while its Asia segment’s net revenue improved 9.1% from the prior year’s value to $380.20 million. Its gross profit rose 8% year-over-year to $1.16 billion. Moreover, the company’s net income amounted to $147.90 million, or $2.31 per share, reflecting increases of 0.7% and 5.5% year-over-year, respectively.

According to the full-year outlook, RL forecasts fiscal year 2025 constant currency revenue to be in the range of 3% to 4%.

The consensus revenue estimate of $2.01 billion for the fiscal third quarter (ending December 2024) represents a 3.9% increase year-over-year. The consensus EPS estimate of $4.50 for the same quarter indicates a 7.9% improvement year-over-year. The company has an excellent surprise history; it surpassed the consensus revenue and EPS estimates in each of the trailing four quarters.

Shares of RL have surged 61% over the past year and 32.6% over the past six months to close the last trading session at $232.22.

RL’s bright prospects are reflected in its POWR Ratings. The stock has an overall rating of B, which translates to a Buy in our proprietary rating system.

It also has an A grade for Quality and a B for Sentiment. Within the Fashion & Luxury industry, it is ranked #11. Click here to see RL’s ratings for Growth, Value, Momentum, and Stability.

Stock #1: H & M Hennes & Mauritz AB (publ) (HNNMY)

Based in Stockholm, Sweden, HNNMY offers clothing, accessories, footwear, cosmetics, home textiles, and homeware for women, men, and children worldwide. The company provides its products under the H&M, H&M HOME, H&M Move, H&M Beauty, COS, Weekday, Monki, & Other Stories, ARKET, Afound, and Singular Society brand names.

On November 19, HNNMY announced that its lifestyle brand, ARKET, will open its first flagship store in Austria in 2025. This upcoming opening is planned to expand the brand’s presence in the European market and allows to connect the European market and allow it to connect with customers on a personal level.

In the same month, AEKET announced plans to open its first flagship store in Norway. Located in Oslo, the new store will have collections offering ready-to-wear and accessories for women, men, and children, complemented by interior essentials for the home.

HNNMY’s net sales for the nine-month period, which ended on August 31, 2024, amounted to SEK172.29 billion ($15.64 billion). Its gross profit grew 4.7% from the year-ago value to SEK791.36 billion ($8.29 billion), while the operating profit rose 24.3% from the prior-year period to SEK12.68 billion ($1.15 billion). Moreover, the company’s profit for the period increased 19% year-over-year to SEK8.50 billion ($771.94 million), and EPS attributable stood at SEK5.29, up 20.5% year-over-year.

Street expects HNNMY’s revenue for the first quarter (ending February 2025) to increase 3.7% year-over-year to $5.24 billion. The company’s revenue for the fiscal year (ending November 2025) is expected to grow 3.7% year-over-year to $22.02 billion.

HNNMY shares have declined 2.6% over the past month to close the last trading session at $2.67.

It’s no surprise that HNNMY has an overall rating of B, equating to a Buy in our POWR Ratings system. It has an A grade for Stability and Quality. Out of 59 stocks in the same industry, HNNMY is ranked #4.

Beyond what is stated above, we’ve also rated HNNMY for Growth, Value, Momentum, and Sentiment. Get all HNNMY’s ratings here.

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TJX shares were trading at $120.67 per share on Tuesday afternoon, down $0.42 (-0.35%). Year-to-date, TJX has gained 30.41%, versus a 24.99% rise in the benchmark S&P 500 index during the same period.