Ross Stores, Inc. (NASDAQ:ROST) Surpasses Earnings Expectations
- Ross Stores, Inc. (NASDAQ:ROST) reported a third-quarter earnings per share (EPS) of $1.48, beating the estimated $1.41.
- The company's revenue for the quarter was $5.07 billion, slightly below the estimated $5.15 billion, yet showed growth from the previous year.
- Ross Stores has adjusted its annual profit forecast upwards, reflecting reduced freight and supply-chain costs, despite facing challenges in the fourth quarter.
Ross Stores, Inc. (NASDAQ:ROST) is a prominent player in the retail sector, known for its off-price retail apparel and home fashion offerings. The company operates under the Ross Dress for Less and dd's DISCOUNTS brands, providing customers with a wide range of products at competitive prices. Ross Stores competes with other discount retailers like TJX Companies and Walmart, which also focus on offering value to budget-conscious consumers.
On November 21, 2024, Ross Stores reported its third-quarter earnings, revealing an earnings per share (EPS) of $1.48, which exceeded the estimated $1.41. This performance highlights the company's ability to deliver better-than-expected results, as it has consistently outperformed consensus EPS estimates over the past four quarters. The earnings surprise for this quarter was 6.47%, showcasing the company's strong financial management.
Despite the positive earnings, Ross Stores' revenue for the quarter was $5.07 billion, slightly below the estimated $5.15 billion. This shortfall represents a 1.56% miss from the Zacks Consensus Estimate. However, the revenue still marks an increase from the $4.92 billion reported in the same period last year, indicating growth in the company's sales performance.
Ross Stores has adjusted its annual profit forecast upward, attributing this to reduced freight and supply-chain costs. This positive outlook led to a 7% rise in the company's shares after the announcement. However, the company has also adjusted its fourth-quarter profit expectations due to challenges faced by its low-to-moderate income customers, who are dealing with high costs on necessities that limit their discretionary spending.
Financially, Ross Stores has a price-to-earnings (P/E) ratio of approximately 22.28, indicating the price investors are willing to pay for each dollar of earnings. The company's price-to-sales ratio is about 2.23, reflecting the market's valuation of its revenue. Additionally, the debt-to-equity ratio is approximately 1.04, suggesting a balanced approach to financing its assets. The current ratio of 1.57 indicates that Ross Stores has a comfortable level of liquidity to cover its short-term liabilities.
| Symbol | Price | %chg |
|---|---|---|
| 9983.T | 44900 | 0 |
| TRENT.NS | 5562.85 | 0 |
| TRENT.BO | 5561.25 | 0 |
| BABY.JK | 298 | 0 |
Ross Stores Reports Q4 Earnings Beat, But Outlook Disappoints
Ross Stores (NASDAQ:ROST) delivered stronger-than-expected fourth-quarter earnings, but issued a disappointing outlook for the current quarter and fiscal year. Currently, the company’s shares are up more than 1% intra-day today.
The retail giant reported earnings per share of $1.79, outpacing Wall Street expectations of $1.65. However, revenue for the quarter totaled $5.91 billion, falling just short of the consensus estimate of $5.94 billion.
Despite the earnings beat, investor sentiment soured due to the company’s cautious forward guidance. For the first quarter of 2026, Ross Stores projected EPS between $1.33 and $1.47, lagging behind analysts’ estimates of $1.54.
For the full fiscal year, the company expects earnings per share in the range of $5.95 to $6.55, below the consensus forecast of $6.72.
Ross Stores Shares Jump 7% on Q3 Earnings Beat Despite Missed Sales Results
Ross Stores (NASDAQ:ROST) saw its stock climb over 7% in pre-market today after reporting third-quarter earnings that exceeded analyst expectations, even as sales fell short.
For the quarter, the off-price retailer delivered earnings per share of $1.48, surpassing the Street consensus estimate of $1.40. Revenue, however, came in at $5.07 billion, below the anticipated $5.16 billion. Comparable store sales increased 1% year-over-year, reflecting slower growth compared to the first half of the year.
Despite the sales shortfall, Ross Stores demonstrated strong profitability. Gross margin expanded to 28.3%, a 71-basis-point increase year-over-year and above the consensus estimate of 27.5%. Operating margin also improved to 11.9%, up from 11.2%, and exceeded the projected 11.1%, as lower operating costs helped offset planned reductions in merchandise margins.
Looking ahead, Ross Stores provided cautious fourth-quarter guidance. The company expects comparable store sales to grow by 2% to 3% and forecasts EPS between $1.57 and $1.64, below the consensus estimate of $1.67. Full-year EPS guidance of $6.10 to $6.17 aligned closely with analyst expectations of $6.13.
Ross Stores Price Target Raised by Barclays
- Barclays has increased the price target for Ross Stores to $165 from its previous target, indicating a bullish outlook.
- Ross Stores reported a revenue of $4.86 billion and an EPS of $1.46 for the first quarter, surpassing analyst expectations.
- The company's strategic focus on offering value through discounted branded and designer apparel has been key to its success, especially in a market sensitive to inflation.
Adrienne Yih of Barclays has recently adjusted the price target for Ross Stores (NASDAQ:ROST) to $165, up from its previous level, based on the company's strong performance and future market potential. This new target suggests a significant upside from the current trading price of $131.86, indicating a bullish outlook on the company's stock. Ross Stores, a prominent player in the off-price retail sector, has consistently demonstrated its ability to navigate the retail landscape effectively, outperforming many of its competitors.
The optimism from Barclays comes on the heels of Ross Stores' impressive first-quarter earnings report for the period ending in April 2024. The company reported revenue of $4.86 billion, an 8.1% increase from the previous year, slightly beating the Zacks Consensus Estimate. This performance underscores Ross Stores' solid growth trajectory and its ability to exceed analyst expectations. Furthermore, the company's earnings per share (EPS) of $1.46, significantly higher than the $1.09 reported in the year-ago quarter, beat the consensus estimate by 8.96%. Such strong financial results highlight Ross Stores' operational efficiency and robust financial health.
The company's success can be attributed to its strategic focus on offering value to customers through branded and designer apparel and footwear at discounted prices. This approach has resonated well with its core demographic, especially in a market environment where consumers are increasingly looking for value due to persistent inflation. Ross Stores' ability to attract and retain customers seeking discounts on quality products has been a key factor in its performance.
Moreover, Ross Stores' management has expressed a cautious yet optimistic outlook for the future, emphasizing the importance of tight inventory and expense control to sustain sales and earnings growth. This prudent approach, combined with a favorable consumer response to its value offerings, positions Ross Stores well for continued success. The company's recent performance and strategic initiatives have clearly resonated with analysts, as evidenced by the revised price target from Barclays.
Ross Stores' stock has seen fluctuations within the trading day but maintains a strong position in the market with a market capitalization of around $44.21 billion. The company's ability to outperform Wall Street expectations and its positive adjustment in annual profit forecasts further solidify its standing as a leading off-price retailer. With shares surging nearly 7% to $141 in extended trading following the earnings announcement, Ross Stores demonstrates a compelling investment opportunity, backed by solid financial performance and a strategic focus on delivering value to its customers.
Ross Stores Shares Surge 8% Following Q1 Beat
Ross Stores (NASDAQ:ROST) shares rose more than 8% pre-market today after the company reported first-quarter earnings per share (EPS) of $1.46, surpassing the analyst consensus of $1.35. The discount retailer's revenue climbed to $4.86 billion, slightly above the $4.83 billion estimate and marking an 8% increase from $4.5 billion in the same quarter last year. Comparable store sales rose by a healthy 3%.
CEO Barbara Rentler attributed the strong earnings to lower expenses and effective navigation of macroeconomic challenges affecting customer spending.
Looking ahead, Ross Stores expects a 2% to 3% increase in comparable store sales for the second quarter. The company projects second-quarter EPS to range between $1.43 and $1.49, aligning closely with the Street estimate of $1.45.
For the full fiscal year 2025, Ross Stores forecasts EPS between $5.79 and $5.98, with the midpoint of $5.885 slightly below the Street consensus of $5.92.
Ross Stores Stock Gains 5% After Q2 Beat
Ross Stores (NASDAQ:ROST) shares rose more than 5% pre-market today after the company’s announcement of a second-quarter performance that exceeded expectations, coupled with its guidance that surpasses consensus forecasts.
The retailer posted earnings of $1.32 per share, accompanied by revenue of $4.93 billion, reflecting a 7.7% increase compared to the same period last year. This performance exceeded the Street predictions, which had anticipated earnings of $1.16 per share on revenue amounting to $4.75 billion.
Looking ahead, Ross Stores anticipates EPS in the range of $1.16 to $1.21 for the third quarter. For the full year, the company sees EPS at $5.15-$5.26, above the Street estimate of $4.97.
