TJX Companies (TJX -0.02%) announces its latest earnings results in just a few days, and Wall Street will be watching. The off-price retailer's stock has been trailing the market in 2021, but its performance gap is closing. Investors are hoping to see evidence of a gathering growth rebound and improving profitability thanks to economic reopenings through the early summer.

That recovery will ideally spur an upgrade to management's fiscal year outlook, too. So, let's look at three key metrics to watch when TJX Companies announces its results on Wednesday, Aug. 18.

Three shoppers in an outdoor mall.

Image source: Getty Images.

1. Sales rebounds

There's been a lot of noise in TJX's last few announcements. But most indications are that this week's report will be a head-turner. Comparable-store sales gains were 16% in Q1, the company revealed in early May. Management raised its outlook just a few days later, too, after those trends continued deep into the second quarter. Many peers have been describing unusually strong selling conditions for apparel and home furnishings so far in 2021.

Most analysts are expecting soaring sales gains, with revenue projected to jump 66% compared to a year earlier when most stores were temporarily closed. Yet TJX might even surpass that forecast if it was able to stock the right merchandise for shoppers seeking apparel and home furnishings. The HomeGoods franchise should lead the way higher, just as it did last quarter.

2. More normal margins

There's no shortage of profit pressures out there, including higher transportation and labor costs. TJX might also have struggled to find its usual deep discounts on apparel and home furnishings during the cyclical industry upturn. Full-price retailers haven't had to resort to much discounting in recent months, after all.

Yet Wall Street is nevertheless hoping to see improving margins. TJX's peers are enjoying rebounds in this arena as they rely less on promotions and as shoppers opt for more premium products. The off-price giant should benefit from that situation.

TJX Operating Margin (TTM) Chart

TJX Operating Margin (TTM) data by YCharts

TJX Companies enjoyed double-digit operating margin before the pandemic scrambled its business. Look for another step back toward that industry-thumping result on Wednesday.

3. Looking out to the holidays

A strong Q2 should convince CEO Ernie Herrman and his team to lift their 2021 outlook again. However, investors must brace for some volatile operating metrics in the second half of the year due to further COVID-19 outbreaks and wild demand swings compared to late 2020.

The good news is that TJX appears to be regaining all of the impressive momentum it had before the pandemic struck. And cash returns are rising, with the dividend reinstated and stock repurchase spending back. Combine those direct returns with the prospect for a full rebound, and TJX looks like an attractive retail stock to consider holding through 2021 and beyond.