Analyzing TJX Companies (NYSE:TJX) and AutoZone (NYSE:AZO)

TJX Companies (NYSE:TJX) and AutoZone (NYSE:AZO) are both large-cap consumer discretionary companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, profitability, valuation, dividends and risk.

Volatility & Risk

TJX Companies has a beta of 0.6, suggesting that its share price is 40% less volatile than the S&P 500. Comparatively, AutoZone has a beta of 0.34, suggesting that its share price is 66% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for TJX Companies and AutoZone, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TJX Companies	0	4	16	2	2.91
AutoZone	0	6	20	1	2.81

TJX Companies currently has a consensus target price of $171.63, indicating a potential upside of 35.64%. AutoZone has a consensus target price of $3,946.96, indicating a potential upside of 38.74%. Given AutoZone’s higher probable upside, analysts plainly believe AutoZone is more favorable than TJX Companies.

Insider and Institutional Ownership

91.1% of TJX Companies shares are held by institutional investors. Comparatively, 92.7% of AutoZone shares are held by institutional investors. 0.2% of TJX Companies shares are held by company insiders. Comparatively, 2.6% of AutoZone shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares TJX Companies and AutoZone”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TJX Companies	$60.37 billion	2.31	$5.49 billion	$5.41	23.39
AutoZone	$19.99 billion	2.32	$2.50 billion	$145.45	19.56

TJX Companies has higher revenue and earnings than AutoZone. AutoZone is trading at a lower price-to-earnings ratio than TJX Companies, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares TJX Companies and AutoZone’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TJX Companies	9.73%	56.56%	15.92%
AutoZone	12.40%	-80.35%	12.33%

Summary

TJX Companies beats AutoZone on 8 of the 15 factors compared between the two stocks.

About TJX Companies

The TJX Companies, Inc., together with its subsidiaries, operates as an off-price apparel and home fashions retailer in the United States, Canada, Europe, and Australia. It operates through four segments: Marmaxx, HomeGoods, TJX Canada, and TJX International. The company sells family apparel, including footwear and accessories; home fashions, such as home basics, furniture, rugs, lighting products, giftware, soft home products, decorative accessories, tabletop, and cookware, as well as expanded pet, and gourmet food departments; jewelry and accessories; and other merchandise. It offers its products through stores and e-commerce sites. The TJX Companies, Inc. was incorporated in 1962 and is headquartered in Framingham, Massachusetts.

About AutoZone

AutoZone, Inc. retails and distributes automotive replacement parts and accessories in the United States, Mexico, and Brazil. The company provides various products for cars, sport utility vehicles, vans, and light trucks, including new and remanufactured automotive hard parts, maintenance items, accessories, and non-automotive products. It also offers A/C compressors, batteries and accessories, bearings, belts and hoses, calipers, chassis, clutches, CV axles, engines, fuel pumps, fuses, ignition and lighting products, mufflers, radiators, starters and alternators, thermostats, and water pumps, as well as tire repairs. In addition, the company provides maintenance products, such as antifreeze and windshield washer fluids; brake drums, rotors, shoes, and pads; brake and power steering fluids, and oil and fuel additives; oil and transmission fluids; oil, cabin, air, fuel, and transmission filters; oxygen sensors; paints and accessories; refrigerants and accessories; shock absorbers and struts; spark plugs and wires; and windshield wipers. Further, it offers air fresheners, cell phone accessories, drinks and snacks, floor mats and seat covers, interior and exterior accessories, mirrors, performance products, protectants and cleaners, sealants and adhesives, steering wheel covers, tools, vehicle entertainment systems, and wash and wax products, as well as towing services. Additionally, the company provides a sales program that offers commercial credit and delivery of parts and other products; sells automotive diagnostic and repair software under the ALLDATA brand through alldata.com and alldatadiy.com; and automotive hard parts, maintenance items, accessories, and non-automotive products through autozone.com. AutoZone, Inc. was founded in 1979 and is headquartered in Memphis, Tennessee.