TJX vs. BURL: Which Off-Price Retailer is the Better Buy Now?

With consumers remaining price-conscious amid an uncertain economic backdrop, off-price retail continues to gain momentum, bringing attention to two prominent players: The TJX Companies, Inc. (TJX) and Burlington Stores, Inc. (BURL). As shoppers increasingly prioritize value, both companies have benefited from steady demand for discounted branded merchandise, underscoring the strength of the Retail – Discount Stores industry and its appeal during challenging economic conditions.

In this face-off, TJX and Burlington represent two competitive approaches within the same discount retail framework. Both benefit from resilient consumer demand, particularly during periods of economic uncertainty, yet differ in scale, store formats, and merchandising strategies. Comparing these companies highlights how execution, growth initiatives, and operational efficiency influence success in the highly competitive off-price retail environment. Let’s take a closer look.

The Case for The TJX Companies Stock

TJX continues to benefit from its highly flexible off-price model, which enables rapid sourcing of quality branded merchandise at attractive values. This approach reinforces the treasure-hunt shopping experience that keeps customers returning frequently. Its broad global presence across the United States, Canada, Europe and Australia further strengthens resilience by diversifying revenue streams and customer bases.

Strong customer traffic continues to fuel TJX’s growth, reflected in a 5% comparable sales increase in the third quarter of fiscal 2026. Each division, Marmaxx, HomeGoods, TJX Canada, and TJX International, delivered positive comps, highlighting broad momentum across categories and regions. This consistent traffic growth demonstrates the power of TJX’s value proposition and its ability to serve a diverse shopper base.

Expansion remains central to TJX’s long-term plans, with the company ending the fiscal third quarter with 5,191 stores globally. Management continues to target a long-term footprint of 7,000 stores across existing markets and its planned entry into Spain. The strong availability of branded inventory further supports this expansion, allowing TJX to stock new and existing stores with compelling assortments at scale.

Despite its strengths, TJX faces margin headwinds from rising operating costs. In the third quarter of fiscal 2026, SG&A deleveraged due to higher payroll, incentive compensation and foundation-related expenses. In addition, tougher shrink comparisons following last year’s favorable adjustment could pressure margins, making profitability gains more challenging even as sales remain solid.

The Case for Burlington Stock

Burlington continues to benefit from disciplined execution of its off-price model, emphasizing branded merchandise at compelling values. In the third quarter of fiscal 2025, total sales rose 7% to $2,706 million, reflecting solid demand and improved merchandising execution. A leaner inventory approach has enhanced assortment freshness, supporting the treasure-hunt experience that resonates with value-focused shoppers.

Operational momentum is also evident in profitability trends. Burlington expanded its adjusted EBIT margin by 60 basis points in the third quarter, while adjusted EPS climbed 16% to $1.80. These gains highlight effective expense management and merchandising discipline, even as the company worked to offset tariff-related pressures without broadly raising prices.

Store expansion remains a meaningful growth lever. Burlington operated 1,211 stores at the end of the fiscal third quarter and now expects to open 104 net new stores in fiscal 2025, with plans for at least 110 net new stores in 2026. Management noted that strong new-store performance and a robust real estate pipeline support continued unit growth with attractive returns.

However, Burlington’s results also reveal meaningful risks. Comparable store sales increased just 1% in the fiscal third quarter, reflecting traffic volatility tied to unseasonably warm weather. Management noted that cold-weather categories represent a sizable portion of the assortment, increasing earnings sensitivity to seasonal shifts. This reliance on weather-driven demand can create short-term sales unpredictability and limit consistency.

How Do the Estimates Compare for TJX & BURL?

The Zacks Consensus Estimate for The TJX Companies’ fiscal 2026 and 2027 EPS has moved down 2 cents to $4.65 and 1 cent to $5.10, respectively, over the past 30 days.

The EPS estimate for Burlington for fiscal 2025 has moved up 17 cents in the past 30 days to $9.60, while the same for fiscal 2026 has slipped down 9 cents to $10.90.

Valuation & Price Performance of TJX & BURL

The TJX Companies currently trades at a forward 12-month P/E ratio of 30.95x, which is above the industry average of 29.39x. In comparison, Burlington trades at a lower multiple of 26.46x.

In terms of stock performance, TJX has delivered a 27.9% gain over the past year, surpassing the industry’s modest 2.5% growth, while Burlington experienced a slight decline of 1.7%.

One-Year Price Performance

Bottom Line: TJX Looks Like the Smarter Off-Price Play for Now

Both TJX and Burlington are well-positioned to benefit from sustained demand for value-oriented retail. However, TJX currently offers greater visibility, supported by stronger comparable sales trends, broader geographic diversification, and consistent stock performance. While Burlington’s margin progress and store expansion are encouraging, TJX’s scale, traffic momentum, and execution provide a more balanced risk-reward profile, making it the steadier off-price choice at this stage.

TJX and BURL carry a Zacks Rank #3 (Hold) each at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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