I very rarely have the necessary willpower that it takes to drive by a TJX Companies (NYSE:TJX) store. Whether I spot Marshall's, T.J. Maxx, HomeGoods, or even A.J. Wright, the pull to browse through the aisles of quality bargains is about as strong as the intoxicating smell of popcorn at the movie concession stand.

TJX faces a lineup of competitors every day to attract customers, including Kohl's (NYSE:KSS), Gap (NYSE:GPS), Federated Department Stores (NYSE:FD), Costco (NASDAQ:COST), Dress Barn (NASDAQ:DBRN), Ross Stores (NASDAQ:ROST), Ethan Allen (NYSE:ETH), and Sports Authority (NYSE:TSA). The only thing I have to complain about with the TJX stores is the line that you have to wait on; the days of at least three cashiers waiting to check people out are long gone.

The company's second-quarter earnings of $0.24 per share fell in line with the company's previously reduced guidance (which was $0.26 per share). TJX said that "sales trends softened during the second quarter," but it took higher markdowns to keep merchandise flowing out of its doors. Net sales increased 12%, and same-store sales were up 3%, largely because of strong showings in footwear, accessories and jewelry, and women's apparel, which made up for the weakness in the men's and home fashions categories.

I have always been a fan of TJX's merchandising strategy but didn't quite understand the company's acquisition of Bob's Stores in December 2003. Shopping at Bob's is probably the most anti-TJX experience you could find in retail. Knowing TJX's style, I'm sure they will also convert this store over to a more attractive and profitable model over time.

For the second half of the year, TJX thinks its inventories are in "great shape," and that bodes well for its prospects. The company is also planning to expand many of its flourishing international locations, as well as domestic strongholds in women's fashions, footwear, and jewelry and accessories. To support this trend, there seems to be at least a 5-to-1 ratio of women to men every time I set foot in the company's stores. However, the company must find ways to combat the slowing men's and home fashions trends.

TJX has been using excess cash to buy back its shares, and it repurchased $171 million, or 7.3 million shares, in the second quarter alone. The shares, which are trading at 14 times the 2005 earnings estimate of $1.62, are nearly fully valued relative to its expected 15% growth rate. The company does pay a small dividend, which translates into a 0.82% yield, and should be seen as a marginal total return play.

Fool contributor Phil Wohl spent more than 12 years on Wall Street and now concentrates his writing on more fictional characters. He has no stake in any firm mentioned above.