Core Viewpoint - Ross Stores, Inc. (ROST) is identified as an attractive value opportunity in the Retail - Discount Stores industry, trading at a forward price-to-earnings ratio of 22.8, which is below the industry average of 31.71x and the Retail-Wholesale average of 25.77x, indicating it is undervalued compared to peers [1] Financial Performance - ROST stock is currently priced at $150.85, reflecting a 7.8% discount from its 52-week high of $163.60 reached on August 23, 2024 [2] - The stock is trading above its 200-day and 50-day moving averages of $143.52 and $146.19, respectively, indicating a sustained upward trend [2] - In the past month, ROST recorded growth of 8.6%, outperforming the broader Retail-Wholesale sector's return of 7.4% and the Zacks Retail - Discount Stores industry's growth of 3.9% [5] Sales and Growth Drivers - ROST experienced a 1% improvement in comparable store sales in the third quarter of fiscal 2024, driven by increased customer traffic and larger basket sizes, leading to a 3% year-over-year sales growth [8] - The company's business model emphasizes competitive bargains, making its stores appealing across various economic conditions, and its off-price model optimizes product allocation and improves margins [9][10] - Ross Stores plans to expand "Ross Dress for Less" to 2,900 stores and dd's DISCOUNTS to 700 stores, reflecting a consistent execution of its store expansion strategy [11] Earnings Estimates - Analysts have revised their EPS estimates upward, with fiscal 2024 and 2025 estimates increased by 1% to $6.17 and 0.8% to $6.67 per share, respectively, indicating expected year-over-year growth rates of approximately 10.9% and 8.1% [12] Future Outlook - For the fourth quarter of fiscal 2024, Ross Stores anticipates a more moderate growth trajectory, expecting comps growth of 2-3% compared to 7% in the prior year, with EPS projected to be $1.35-$1.41, down from $1.82 [14] - The company has been facing higher costs, with COGS increasing by 1.9% year over year in the third quarter, and SG&A expenses rising by 2.8% year over year [15]

Sales Performance - Sales for the three-month period ended November 2, 2024, increased by $146.5 million, or 3.0%, compared to the same period in 2023, primarily due to the opening of 80 net new stores and a 1% comparable store sales increase [81]. - For the nine-month period ended November 2, 2024, sales increased by $862.5 million, or 6.0%, driven by the opening of 80 net new stores and a 3% comparable store sales increase [81]. Cost of Goods Sold - The cost of goods sold for the three-month period ended November 2, 2024, increased by $70.0 million, while for the nine-month period, it increased by $490.6 million, primarily due to higher sales from new store openings [84]. - Cost of goods sold as a percentage of sales for the three-month period ended November 2, 2024, decreased by approximately 70 basis points compared to the same period in 2023, mainly due to lower buying and distribution costs [85]. Expenses - Selling, general and administrative expenses (SG&A) increased by $22.4 million for the three-month period and by $80.9 million for the nine-month period ended November 2, 2024, primarily due to the opening of new stores [88]. Earnings - Net earnings as a percentage of sales for the three-month period ended November 2, 2024, were 9.6%, up from 9.1% in the same period in 2023, attributed to lower cost of goods sold and SG&A expenses [94]. - Diluted earnings per share for the three-month period ended November 2, 2024, was $1.48, a 11.3% increase from $1.33 for the same period in 2023 [96]. - For the nine-month period ended November 2, 2024, diluted earnings per share increased to $4.53, up 21.1% from $3.74 in the prior year [96]. - The increase in diluted earnings per share for the three-month period was driven by a 9% increase in net earnings and a 2% reduction in weighted-average diluted shares outstanding due to stock repurchases [97]. Cash Flow - Net cash provided by operating activities was $1.5 billion for the nine-month period ended November 2, 2024, down from $1.6 billion in the same period last year [100]. - Cash used in investing activities decreased to $514.1 million for the nine-month period ended November 2, 2024, compared to $540.5 million in the prior year [106]. - Net cash used in financing activities increased to $1.5 billion for the nine-month period ended November 2, 2024, from $1.1 billion in the same period last year, primarily due to stock repurchases [109]. - As of November 2, 2024, the company had $4.3 billion of unrestricted cash balances and $1.3 billion available under its Credit Facility [116]. - The company repurchased 5.5 million shares of common stock for $787.5 million during the nine-month period ended November 2, 2024 [112]. Capital Expenditures - Capital expenditures for fiscal 2024 are projected to be approximately $760 million, focusing on new store openings and improvements [108]. Inventory - Packaway inventory was 38% of total inventory as of November 2, 2024, down from 40% at the end of fiscal 2023 [105]. Leadership Changes - The company appointed James G. Conroy as the new CEO, effective February 2, 2025, succeeding Barbara Rentler [76]. Tax Rate - The effective tax rate for the three and nine-month periods ended November 2, 2024, was approximately 24%, compared to 25% for the same periods in 2023 [93].

Core Viewpoint - The analyst maintains a hold rating on Ross Stores (NASDAQ: ROST) despite a positive outlook for same-store sales (SSS) growth, indicating that the current valuation is not attractive [1]. Group 1: Company Analysis - The analyst previously covered Ross Stores on September 17, 2024, and expressed concerns about the attractiveness of its valuation [1]. - There is an expectation for SSS growth to accelerate, but this has not changed the hold rating [1]. Group 2: Investment Approach - The analyst employs a diverse investment strategy that includes fundamental, technical, and momentum investing, utilizing the strengths of each approach to refine the investment process [1]. - The purpose of writing on Seeking Alpha is to track the performance of investment ideas and connect with like-minded investors [1].

Core Insights - Ross Stores aims to attract customers and boost sales by providing value and a "treasure hunt environment" in its stores [1] - The company reported a 1% increase in comparable store sales for the quarter ending Nov. 2, and a 3% increase for the nine months ending Nov. 2 [2] - Ross Stores experienced a slowdown in sales growth due to high costs of necessities affecting discretionary spending, severe weather events, and unseasonably warm weather [3] Sales Performance - Comparable store sales growth is expected to be between 2% to 3% for the quarter ending Feb. 1, 2025 [4] - The company noted that certain key businesses, particularly those important during the holiday season, have shown strength [5] Operational Insights - Ross Stores' earnings exceeded expectations due to a higher operating margin and reduced costs related to incentives, freight, and distribution [3] - The company acknowledged execution issues in merchandising initiatives that may have impacted sales volume [4]

Core Viewpoint - Ross Stores, Inc. reported third-quarter results with an EPS of $1.48, surpassing the consensus of $1.40, while sales of $5.07 billion fell short of the expected $5.15 billion. The company provided fourth-quarter EPS guidance of $1.57 – $1.64, below the consensus of $1.67, and FY25 EPS guidance of $6.10 – $6.17, slightly above the street view of $6.14 [1]. Group 1: Analyst Ratings and Price Targets - BofA Securities analyst Lorraine Hutchinson reiterated a Buy rating with a price target of $180 [2]. - Telsey Advisory Group analyst Dana Telsey maintained a Market Perform rating with a price target of $175 [4]. - Guggenheim analyst Robert Drbul also maintained a Buy rating with a price target of $180 [7]. - BMO Capital Markets analyst Simeon Siegel kept an Outperform rating with a price target of $168 [11]. Group 2: Earnings and Guidance Analysis - The earnings beat was attributed to margin tailwinds, despite sales falling short due to unfavorable weather and product assortment issues [4]. - The fourth-quarter guidance reflects a timing shift in packaway expenses and the impact of last year's extra week, which contributed positively to EPS in the prior year [3]. - Management lowered its fourth-quarter EPS guidance but slightly raised the FY EPS high-end by $0.03, indicating a conservative outlook [12]. Group 3: Market Conditions and Consumer Behavior - The company continues to attract value-seeking customers, although macroeconomic uncertainty and price sensitivity among its core demographic pose challenges [6]. - Analysts expect Ross to maintain positive sales momentum during the holiday season, driven by gifting and seasonal items [9]. - The impact of persistent inflation on discretionary spending has led to a slight reduction in FY24 revenue forecasts [8]. Group 4: Future Projections - Analysts have adjusted EPS estimates for FY24, FY25, and FY26 to $6.19, $6.54, and $7.14, respectively, reflecting quarterly results and slight margin forecast updates [10]. - The appointment of a new CEO effective February 2025 is seen as an additional catalyst for the company [10].

Ross Stores ROST reported better-than-expected third-quarter EPS results on Thursday.Ross Stores reported quarterly earnings of $1.48 per share which beat the analyst consensus estimate of $1.40 per share. The company reported quarterly sales of $5.07 billion which missed the analyst consensus estimate of $5.15 billion.Barbara Rentler, Chief Executive Officer, commented, “We are disappointed with our third quarter sales results as business slowed from the solid gains we reported in the first half of 2024. A ...

U.S. stocks traded mostly higher midway through trading, with the Dow Jones index gaining by more than 250 points on Friday.The Dow traded up 0.59% to 44,128.84 while the NASDAQ rose 0.08% to 18,986.80. The S&P 500 also rose, gaining, 0.28% to 5,965.15.Check This Out: Top 3 Materials Stocks That Could Blast Off In NovemberLeading and Lagging SectorsConsumer staples shares rose by 1.5% on Friday.In trading on Friday, communication services shares fell by 0.6%.Top HeadlineRoss Stores ROST reported better-than ...

Ross Stores, Inc. (ROST) reported results for the third quarter of 2024, wherein the bottom line surpassed the Zacks Consensus Estimates, while the top line missed the same. Net sales and earnings increased from the year-ago period.The company faced challenges as its low-to-moderate-income customers grappled with persistently high living costs, limiting discretionary spending. Additionally, Hurricanes Helene and Milton, and unseasonably warm temperatures, negatively impacted comparable sales (comps). Despit ...

Core Insights - Ross Stores reported third-quarter profits of $488.8 million on sales of $5.07 billion, exceeding analyst expectations for profits of $459.8 million but falling short on sales which were expected to be $5.14 billion [2][3] - CEO Barbara Rentler noted that customers are facing persistently high costs on necessities, impacting discretionary spending and leading to a 1% growth in comparable store sales, below the expected 2.2% [3] - The company anticipates 2% to 3% comparable sales growth in the fourth quarter and has raised its full-year earnings per share (EPS) guidance to between $6.10 and $6.17 [4] Management Changes - James Conroy, currently CEO of Boot Barn, will succeed Barbara Rentler as CEO of Ross Stores upon her retirement on February 2, 2025, with Rentler remaining in an advisory role until March 2027 [5] Stock Performance - Following the earnings report, Ross Stores shares increased by as much as 4.7%, reaching $149.63 [6]

Shares of Gap Inc (NYSE:GAP) and Ross Stores Inc (NASDAQ:ROST) are both making outsized moves, after the retail companies posted their quarterly results.Gap stock was last seen 8.2% higher at $23.84, after the retail name hiked its annual guidance for the third time in 2024. The company now expects fiscal 2024 sales to rise between 1.5% and 2%, well above analysts' 0.4% growth expectations. And while hurricanes and unseasonably warm weather dented sales, Gap beat third-quarter earnings per share and revenue ...