Off-price retailer TJX's sales beat on strong holiday demand

TJX Cos Inc, the owner of T.J. Maxx and Marshalls off-price retail chains, reported higher-than-expected quarterly sales as it attracted more bargain-hungry shoppers in the holiday season.

TJX also said that it would buy back about $1.5 billion-$2.0 billion in shares and the company forecast full-year profit largely above analysts' estimates.

The retailer's shares rose 1 percent to $73.40 in premarket trading on Wednesday.

TJX, which sells apparel of brands such as Dolce and Gabbana and Juicy Couture at up to 80 percent discount, said sales at its established stores rose 6 percent in the fourth quarter.

Analysts on average had expected a rise of 3 percent, according to research firm Consensus Metrix.

In the holiday season, "off-price retailers were a preferred destination for much of the middle and upper-middle class seeking brand names at value prices," Ken Perkins, the president of research firm Retail Metrics, wrote in a note.

TJX forecast a profit of $3.29-$3.38 per share for the year ending Jan. 28, 2017. Analysts on average were expecting $3.29 per share, according to Thomson Reuters I/B/E/S.

"The year is off to a strong start and we have many initiatives planned to continue driving sales and traffic," Chief Executive Ernie Herrman said in a statement.

TJX's net income rose 2.8 percent to $666.5 million, or 99 cents per share, in the quarter ended Jan. 30, beating the average analyst estimate of 94 cents per share.

Net sales increased 7.9 percent to $8.96 billion, topping analysts' expectations of $8.73 billion.

The retailer also raised its quarterly dividend by 24 percent to 26 cents per share.