Morgan Stanley makes a buy call on tumbling retail giant stock

TJX Companies, the parent firm of retail chains TJ Maxx, Marshalls and Sierra, is facing a slump in sales at its flagship Marmaxx division. As reported by Bloomberg on September 4, 2026, the stock has fallen about 16% over the past month. Despite this, Morgan Stanley analysts are maintaining a positive outlook on the company. Analyst Alex Straton has reasserted an Overweight rating and set a price target of $178, indicating a 35% upside potential from its early September level near $131.

This recommendation is based on the belief that TJX is a consumer compounder, consistently growing profits through both good and bad times. Straton highlighted three key issues: understaffed teams, disorganized storage leading to inventory sitting unsold, and a mismatch between TJX's product mix and market trends. Despite these challenges, TJX still outperformed expectations in its earnings report, with overall comparable sales up 4% and adjusted earnings per share rising 11%.

HomeGoods division, in particular, drove this growth with a 7% increase in comparable sales. Morgan Stanley expects TJX to address these issues and improve Marmaxx's performance, particularly in the fourth quarter. The bank is confident that TJX's diverse portfolio of brands and strong overall performance will help the company overcome short-term hurdles.