The reign of one of the most successful chief executives in retailing will come to an end early next year, when TJX Cos.’ Carol Meyrowitz plans to step down.
In her nine years as CEO of the discount fashion and home goods retailer, sales soared 67 percent to $29.1 billion and income nearly tripled to $2.2 billion. Meyrowitz, 61, is credited with making the Framingham-based company a recession-resistant powerhouse that has outpaced its peers year in and year out.
TJX said Wednesday that Meyrowitz will be succeeded by her second in command, president and 26-year TJX veteran Ernie Herrman.
Herrman, 54, was widely expected to take over once Meyrowitz decided to bow out, and investors pushed TJX’s stock up on the news.
“She expanded the company tremendously and with tremendous success in every direction,” said Richard Jaffe, a retail analyst at the New York investment firm Stifel. “She’s a tough act to follow.”
TJX is the parent company of T.J. Maxx, Marshalls, HomeGoods, and Sierra Trading Post in the United States, as well as Winners, HomeSense, and Marshalls in Canada. The company also operates T.K. Maxx in the United Kingdom, Ireland, Germany, Poland, and Austria, and HomeSense in the United Kingdom.
TJX buys clothing and goods from other brands, designers, stores, and manufacturers around the world, often purchased in bulk or leftover selections to offer low prices to consumers. The company also works with factories to create its own in-house brands.
Retail analysts said TJX has been plotting a succession plan for Meyrowitz for more than a year, and the company has a history of promoting the number two, making Herrman an obvious choice for the job.
Meyrowitz said in a statement that she and the board “could not be more convinced” that Herrman is the best person to lead the company.
“Ernie Herrman’s proven, successful track record, leadership abilities, strategic vision, discipline and focus are all qualities that make him absolutely the right choice for CEO,” she said.
TJX said Meyrowitz will become executive chairman and advise Herrman on long-term growth initiatives and strategy under a three-year agreement.
Jaffe said one of Meyrowitz’s most notable accomplishments as chief executive has been her focus on international expansion. He said Meyrowitz successfully pushed TJX into the United Kingdom and Europe. She is also credited with globalizing the company’s merchandizing capabilities by adding more buyers to pull in a greater assortment of products from other countries.
“Carol is not only successful, but she’s charismatic,” Jaffe said. “She has a passion for the business that is palatable.”
Meyrowitz has made headlines over the years as one of the highest-paid chief executives in Massachusetts. She took home $28.7 million in total compensation in 2014, a year in which company sales grew 6 percent and income increased nearly 3.6 percent.
But her road to the top of retail had a few setbacks. In 2000, Ted English was named CEO when founder Ben Cammarata stepped down after having served in that role since 1987.
Meyrowitz remained with the company during most of English’s lackluster tenure, as executive vice president of TJX and president of Marmaxx Group. She shifted to an advisory role for a few months in 2005 and then became president in October of that year, shortly after English resigned.
Cammarata served as chief executive again until Meyrowitz got the job in January 2007.
Under her leadership, TJX’s market capitalization grew from about $13 billion to $48.3 billion today, the fourth-highest among Massachusetts companies.
“She has a very rare, strong legacy for the past decade,” said Anne-Charlotte Windal, a senior analyst for US speciality retail at Bernstein Research in New York. “Herrman is very similar to Carol and really came up through the ranks. He was also very instrumental in the international expansion of the company.”
Herrman, a Boston College graduate, has a long history with TJX and started as a buyer. He went on to become senior executive vice president and group president overseeing Marmaxx Group, HomeGoods, and TJX Canada.
He was named president in January 2011.
Laura Champine, a senior retail analyst with Cantor Fitzgerald in New York, said that investors are comfortable with the change. The stock rose 1.6 percent to $71.90 a share, double the gain of the Standard & Poor’s 500 index on Wednesday.
“You have a CEO with a phenomenal track record who leaves and the stock actually performs really well today,” Champine said. “That’s really rare and a testament to the depth of the bench.”