Retail Industry Overview - Retail earnings reports indicate that comparable store sales and traffic have exceeded expectations, with notable Q3 performance driven by pricing strategies [2][3] - Retailers across various segments have increased prices in response to tariffs, experiencing less price resistance than anticipated, which has positively impacted comparable sales [3] Consumer Sentiment and Guidance - Retailers targeting middle and lower-income consumers are cautious due to declining consumer sentiment, leading to conservative Q4 guidance [4] - There is a noticeable bifurcation in consumer sentiment between higher and lower-income groups, affecting retail strategies [7] Company-Specific Insights: Burlington Stores - Burlington is identified as the smallest and lowest quality player in the off-price retail sector, facing challenges compared to competitors like TJX and Ross Stores, which are more established [5] - Burlington's recent performance showed a modest increase in comparable sales (+1%), while competitors reported significantly higher growth (+6% to +7%) [6] Investment Outlook - The market is expected to favor companies perceived as safer investments amid consumer risk, particularly those catering to higher-income consumers, such as TJX [7][8] - TJX is viewed as a strong investment option due to its quality and resilience in the current market environment [6][8]

Core Insights - Momentum investing focuses on following a stock's recent price trends, aiming to buy high and sell higher as stocks tend to continue in their established direction [1] - Ross Stores (ROST) currently holds a Momentum Style Score of A, indicating strong momentum characteristics [2][3] - ROST has a Zacks Rank of 2 (Buy), suggesting it is positioned to outperform the market [3] Price Performance - ROST shares have increased by 8.36% over the past week, while the Zacks Retail - Discount Stores industry has declined by 2.49% during the same period [5] - Over the past quarter, ROST shares have risen by 16.69%, and over the last year, they have gained 14.33%, compared to the S&P 500's increases of 5.38% and 14.31%, respectively [6] Trading Volume - ROST's average 20-day trading volume is 2,920,602 shares, which serves as a bullish indicator when combined with rising stock prices [7] Earnings Estimates - In the past two months, 6 earnings estimates for ROST have been revised upwards, increasing the consensus estimate from $6.19 to $6.36 [9] - For the next fiscal year, 6 estimates have also moved higher with no downward revisions [9] Conclusion - Given the strong momentum indicators and positive earnings outlook, ROST is recommended as a 2 (Buy) stock with a Momentum Score of A, making it a potential pick for investors [11]

Core Insights - Two stocks in the consumer discretionary sector are signaling potential warnings for momentum-focused investors as of November 25, 2025 [1] Company Performance - Ross Stores Inc reported better-than-expected third-quarter financial results and raised its fourth-quarter GAAP EPS guidance, with a stock price increase of approximately 10% over the past five days and a 52-week high of $177.32 [6] - The RSI value for Ross Stores is 80.5, indicating it is overbought [6] - Citi Trends reported second-quarter sales of $190.75 million, an 8% year-over-year increase, surpassing analyst expectations, with a stock price increase of around 25% over the past month and a 52-week high of $45.63 [6] - The RSI value for Citi Trends is 77.3, also indicating it is overbought [6]

Core Insights - Two stocks in the consumer discretionary sector are signaling potential warnings for momentum-focused investors as of November 25, 2025 [1] Company Performance - Ross Stores Inc reported better-than-expected third-quarter financial results and raised its fourth-quarter GAAP EPS guidance, with CEO Jim Conroy noting strong sales and customer engagement [6] - Ross Stores' stock gained approximately 10% over the past five days, reaching a 52-week high of $177.32, with an RSI value of 80.5 and a closing price of $176.50 [6] - Citi Trends reported second-quarter sales of $190.75 million, an 8% year-over-year increase, exceeding analyst expectations, and noted a 9.2% rise in comparable store sales for the fourth consecutive quarter [6] - Citi Trends' stock increased around 25% over the past month, achieving a 52-week high of $45.63, with an RSI value of 77.3 and a closing price of $45.17 [6]

Core Viewpoint - Hennes & Mauritz AB (HNNMY) is currently outperforming its peers in the Retail-Wholesale sector, with a year-to-date return of 34.9% compared to the sector average of 3.7% [4]. Company Performance - Hennes & Mauritz AB has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook [3]. - The Zacks Consensus Estimate for HNNMY's full-year earnings has increased by 8.1% over the past quarter, reflecting improved analyst sentiment [4]. - The company belongs to the Retail - Apparel and Shoes industry, which has seen an average loss of 14.8% this year, highlighting HNNMY's strong performance relative to its industry [6]. Industry Context - The Retail-Wholesale sector includes 195 individual stocks and currently holds a Zacks Sector Rank of 10 [2]. - The Retail - Apparel and Shoes industry, which includes Hennes & Mauritz AB, is ranked 58 in the Zacks Industry Rank [6]. - In comparison, Ross Stores, another outperforming stock in the Retail-Wholesale sector, has a year-to-date return of 15.1% and belongs to the Retail - Discount Stores industry, which is ranked 94 [5][6].

Core Viewpoint - The article discusses the reliability of Wall Street analysts' recommendations, particularly focusing on Ross Stores (ROST), and emphasizes the importance of using these recommendations in conjunction with other analytical tools like the Zacks Rank for making informed investment decisions [1][5]. Group 1: Brokerage Recommendations - Ross Stores has an average brokerage recommendation (ABR) of 1.60, indicating a rating between Strong Buy and Buy, based on recommendations from 20 brokerage firms [2]. - Out of the 20 recommendations, 14 are classified as Strong Buy, accounting for 70% of all recommendations [2]. Group 2: Limitations of Brokerage Recommendations - Studies indicate that brokerage recommendations have limited success in guiding investors towards stocks with the highest price increase potential [5]. - Analysts from brokerage firms tend to exhibit a strong positive bias in their ratings, often issuing five "Strong Buy" recommendations for every "Strong Sell" [6][11]. - The interests of brokerage firms may not align with those of retail investors, leading to potential misguidance regarding stock price movements [7][11]. Group 3: Zacks Rank as an Alternative - The Zacks Rank is presented as a more reliable indicator of a stock's near-term price performance, based on earnings estimate revisions, and is classified into five groups from Strong Buy to Strong Sell [8][12]. - The Zacks Rank is updated more frequently than the ABR, reflecting timely changes in earnings estimates and business trends [13]. - For Ross Stores, the Zacks Consensus Estimate for the current year has increased by 4.4% to $6.36, indicating positive sentiment among analysts regarding the company's earnings prospects [14]. Group 4: Investment Implications - The recent change in the consensus estimate and other factors have led to a Zacks Rank 2 (Buy) for Ross Stores, suggesting that the Buy-equivalent ABR may serve as a useful guide for investors [15].

Core Viewpoint - Ross Stores (ROST) has shown strong stock performance, with an 8.3% increase over the past month and a 15.1% gain since the start of the year, outperforming both the Zacks Retail-Wholesale sector and the Zacks Retail - Discount Stores industry [1] Financial Performance - The company has consistently beaten earnings estimates, reporting an EPS of $1.58 against a consensus estimate of $1.4 in its last earnings report [2] - For the current fiscal year, Ross Stores is projected to achieve earnings of $6.36 per share on revenues of $22.27 billion, reflecting a 0.63% change in EPS and a 5.39% change in revenues [3] - For the next fiscal year, expected earnings are $6.99 per share on revenues of $23.44 billion, indicating a year-over-year change of 9.93% in EPS and 5.28% in revenues [3] Valuation Metrics - The stock currently trades at 27.4X current fiscal year EPS estimates, aligning with the peer industry average, while on a trailing cash flow basis, it trades at 22.6X compared to the peer group's average of 17.9X [7] - The PEG ratio stands at 3.89, which does not position the company among the top stocks from a value perspective [7] Style Scores and Zacks Rank - Ross Stores has a Value Score of D, while its Growth and Momentum Scores are B and A, respectively, resulting in a combined VGM Score of B [6] - The company holds a Zacks Rank of 2 (Buy), supported by a solid earnings estimate revision trend [8] - Given the Zacks Rank and Style Scores, Ross Stores appears to meet the criteria for potential investment opportunities in the near future [9]

Company Overview - Ross Stores, Inc. (NASDAQ:ROST) experienced a significant share price increase of nearly 8.5% following the announcement of better-than-expected earnings and an upward revision of guidance [1] - The current market sentiment suggests potential profit-taking, which may exert downward pressure on the stock [1] Trading Dynamics - Stocks generally operate within an average trading range, and significant buying or selling can push them outside this range, attracting trader attention [2] - When a stock is above its average range, it is considered 'overbought', prompting some traders to sell in anticipation of a price reversal [3] Technical Analysis - The Relative Strength Index (RSI) is a tool used by traders to identify overbought conditions, with Ross Stores currently showing signs of being overbought [3][5] - Over the past year, Ross Stores has been classified as overbought on four occasions, with three instances resulting in a price decline, while one instance in August led to sideways movement instead of a decline [5] Market Sentiment - The concept of reversion to the mean suggests that extreme price movements are likely to be followed by corrections, indicating that Ross Stores may face downward pressure as profit-takers enter the market [6]

Market Overview - The U.S. stock market opened on November 24, 2025, with a mixed but generally positive tone, driven by investor confidence in potential interest rate cuts by the Federal Reserve [1] - The Nasdaq Composite rose by 1.4%, while the S&P 500 gained 0.6%, contrasting with a slight dip of 0.1% in the Dow Jones Industrial Average [2] - The market sentiment is influenced by expectations of a quarter-percentage point interest rate cut at the upcoming December meeting of the Federal Reserve [2] Recent Market Performance - Last week, all three major indexes finished lower, with the Nasdaq down 2.7% and both the Dow and S&P 500 dropping 1.9% [3] - The opening performance on Monday suggests a renewed push higher as the week begins [3] Upcoming Economic Reports - Key economic reports are set to be released this week, including delayed September retail sales and Producer Price Index (PPI) reports on November 25 [5] - Additional reports include weekly jobless claims and durable goods orders for September on November 26, and the October Chicago Fed National Activity Index and November Dallas Fed Manufacturing Survey on November 24 [5] Corporate Earnings - Notable companies reporting earnings this week include Zoom Video Communications, Alibaba, and Deere & Company, which will provide insights into corporate health and consumer behavior [6] Major Stock News - US Foods Holdings shares surged by 5.5% after terminating merger talks with Performance Food Group, whose shares fell nearly 3% [7] - Ross Stores Inc. saw an 8.4% increase in shares after reporting adjusted earnings of $1.58 per share, surpassing estimates [8] - Intuit Inc. shares climbed 4% following adjusted earnings of $3.34 per share, also exceeding expectations [8] - UGI Corp. reported a narrower-than-expected loss, leading to a 7.1% gain in shares [8] - Copart Inc. shares fell 0.7% after missing revenue estimates [8] Sector-Specific Developments - Novo Nordisk shares dropped 10% after its Alzheimer's drug trial failed, potentially impacting the pharmaceutical sector [9] - Alibaba shares gained 4.7% in Hong Kong trading, driven by strong demand for its updated Qwen AI app ahead of its earnings report [9] - JPMorgan analysts identified 15 AI-exposed stocks as potential bargains, with declines of 10% to 40% from recent highs, indicating investment opportunities in the AI sector [10]

Core Insights - Ross Stores reported a 10% increase in Q3 sales to $5.6 billion, up from $5.1 billion in the same quarter last year, with comparable store sales rising 7% [1] - The growth was attributed to a brand-focused merchandise assortment and a new marketing campaign that enhanced customer engagement [1][2] Q3 Performance - For the 13 weeks ending 1 November 2025, diluted earnings per share (EPS) were $1.58, with net earnings of $511.9 million, compared to EPS of $1.48 and net earnings of $488.8 million in the prior year [3] - The results included an approximate $0.05 per share negative impact from tariff-related costs [3] Year-to-Date Performance - In the first nine months of FY25, Ross Stores reported EPS of $4.61 and net income of $1.5 billion, compared to EPS of $4.53 and net income of $1.5 billion in the same period of FY24 [4] - Sales for the first nine months were $16.1 billion, with comparable store sales up 3% year-over-year [4] Q4 Outlook - For Q4, the company expects comparable store sales to rise 3% to 4%, with EPS projected between $1.77 and $1.85 for the 13 weeks ending 31 January 2026 [5] - The Q4 earnings range reflects about $0.03 per share of unfavorable timing of packaway-related expenses [5] FY25 Guidance - Ross Stores raised its EPS guidance for FY25 to a range of $6.38 to $6.46, considering year-to-date results and the updated Q4 forecast [6] - The updated annual outlook includes an estimated $0.16 per share negative impact from tariff-related costs, which are expected to be negligible in Q4 [6] Holiday Season Prospects - The company expressed optimism for the holiday season, focusing on delivering quality branded merchandise at exceptional value [7]