Ross Stores (ROST) AI Stock Analysis

• Market Cap: $47.82B
• Dividend Yield: 1.08%
• Average Volume (3M): 2.92M
• Price to Earnings (P/E): 23.4
• Beta (1Y): 0.77
• Revenue Growth: 1.92%
• EPS Growth: 1.50%
• Country: US
• Employees: 107,000
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Apparel - Retail
• EPS (TTM): 1.56
• Shares Outstanding: 325,226,260
• 10 Day Avg. Volume: 2,321,504
• 30 Day Avg. Volume: 2,916,618
• PEG Ratio: 1.72
• Price to Book (P/B): 8.98
• Price to Sales (P/S): 2.34
• P/FCF Ratio: 30.22
• Enterprise Value/Market Cap: 0.96
• Enterprise Value/Revenue: 2.13
• Enterprise Value/Gross Profit: 7.70
• Enterprise Value/Ebitda: 13.71
• 1Y Price Target: $160.64
• Price Target Upside: 9.69% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 16

• Rating: 75 Outperform
• Price Target: $166.00 ▲(13.35% Upside)

Ross Stores' strong financial performance and positive technical indicators are significant strengths. However, valuation concerns and challenges from tariffs and operating margin pressures temper the outlook. The new credit facility adds financial flexibility, supporting future growth.

Positive Factors

Revenue Growth

The strong revenue growth indicates Ross Stores' ability to capture market share and meet consumer demand, supporting long-term business expansion.

Geographic Expansion

Expanding into new markets like the New York Metro area and Puerto Rico enhances Ross Stores' market presence and potential customer base, driving future growth.

Financial Flexibility

The new credit facility provides Ross Stores with increased financial flexibility to support operational needs and strategic initiatives, ensuring stability and growth.

Negative Factors

Operating Margin Pressure

Decreased operating margins due to tariff costs could impact profitability, requiring strategic adjustments to maintain financial performance.

Tariff-Related Challenges

Ongoing tariff-related challenges could continue to pressure earnings, necessitating effective cost management and pricing strategies to mitigate impacts.

Earnings Per Share Decline

A decline in EPS indicates potential challenges in maintaining profitability, impacting investor confidence and requiring strategic focus on cost efficiencies.

Ross Stores Business Overview & Revenue Model

Company Description

Ross Stores, Inc. is a leading off-price retailer in the United States, operating the Ross Dress for Less and dd's Discounts brands. The company is focused on providing a wide variety of apparel, footwear, accessories, and home goods at discounted prices. Ross Stores caters to value-conscious consumers by offering brand-name merchandise at significant savings compared to traditional department stores, primarily targeting customers looking for quality products at lower prices.

How the Company Makes Money

Ross Stores generates revenue primarily through the sale of discounted apparel and home goods in its retail locations. The company's revenue model is based on purchasing excess inventory and closeout merchandise from manufacturers and wholesalers at reduced prices, which allows them to sell these items at lower prices while maintaining healthy profit margins. Key revenue streams include sales from its Ross Dress for Less stores and dd's Discounts locations. Additionally, Ross benefits from its ability to quickly adapt to changing market trends, stock a rotating selection of products, and attract a loyal customer base seeking value. The company's efficient supply chain and inventory management practices further enhance its profitability, enabling it to minimize markdowns and maximize sales of in-demand items.

Ross Stores Financial Statement Overview

Summary

Ross Stores exhibits strong financial health with robust revenue growth, improving profitability, and effective cash flow management. The balance sheet is solid with a manageable level of debt, though leverage should be monitored.

Income Statement

Ross Stores has demonstrated strong revenue growth with a TTM increase of 13.7% and consistent improvement in profitability metrics. The gross profit margin and net profit margin have shown positive trends, indicating effective cost management and operational efficiency. EBIT and EBITDA margins are robust, reflecting strong core earnings performance.

Balance Sheet

The balance sheet shows a healthy equity position with a declining debt-to-equity ratio, now at 0.84 in the TTM period. Return on equity remains strong, indicating efficient use of shareholders' funds. However, the company should continue to monitor its leverage to maintain financial stability.

Cash Flow

Ross Stores has shown impressive free cash flow growth in the TTM period, with a 4.48% increase. The operating cash flow to net income ratio is solid, suggesting effective cash generation relative to earnings. The free cash flow to net income ratio indicates a strong ability to convert earnings into cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	21.50B	21.13B	20.38B	18.70B	18.92B	12.53B
Gross Profit	5.94B	5.87B	5.58B	4.75B	5.21B	2.69B
EBITDA	3.33B	3.27B	2.97B	2.46B	2.69B	558.61M
Net Income	2.06B	2.09B	1.87B	1.51B	1.72B	85.38M
Balance Sheet
Total Assets	14.50B	14.91B	14.30B	13.42B	13.64B	12.72B
Cash, Cash Equivalents and Short-Term Investments	3.85B	4.73B	4.87B	4.55B	4.92B	4.82B
Total Debt	5.07B	5.68B	5.75B	5.71B	5.62B	5.73B
Total Liabilities	8.76B	9.40B	9.43B	9.13B	9.58B	9.43B
Stockholders Equity	5.73B	5.51B	4.87B	4.29B	4.06B	3.29B
Cash Flow
Free Cash Flow	1.68B	1.64B	1.75B	1.04B	1.18B	1.84B
Operating Cash Flow	2.47B	2.36B	2.51B	1.69B	1.74B	2.25B
Investing Cash Flow	-712.83M	-637.46M	-762.81M	-654.07M	-557.84M	-405.43M
Financing Cash Flow	-2.58B	-1.86B	-1.43B	-1.41B	-1.15B	1.70B

Ross Stores Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 146.45
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ROST, the sentiment is Neutral. The current price of 146.45 is below the 20-day moving average (MA) of 148.55, above the 50-day MA of 142.59, and above the 200-day MA of 140.78, indicating a neutral trend. The MACD of 1.17 indicates Positive momentum. The RSI at 49.19 is Neutral, neither overbought nor oversold. The STOCH value of 9.79 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ROST.

Ross Stores Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TJX	79 Outperform	155.86B	31.84	56.10%	1.14%	4.14%	5.83%
ROST	75 Outperform	$47.82B	23.35	37.98%	1.08%	1.92%	1.50%
GAP	75 Outperform	8.46B	9.73	25.90%	2.76%	-0.05%	15.17%
ONON	69 Neutral	14.32B	93.92	9.73%	―	39.16%	-14.16%
BURL	67 Neutral	16.57B	31.02	37.76%	―	7.56%	29.06%
AEO	66 Neutral	3.37B	19.13	12.76%	2.52%	-2.73%	-16.71%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Ross Stores Corporate Events

Ross Stores Appoints New CFO William Sheehan

Ross Stores, Inc. announced a leadership transition with the appointment of William Sheehan as Executive Vice President and Chief Financial Officer, effective October 1, 2025, following the retirement of current CFO Adam Orvos. Sheehan, who has extensive experience in the retail sector, has been with the company since 2006 and will receive a comprehensive compensation package, including a base salary, bonus, and stock award, as part of his new role.

Ross Stores Establishes New $1.3 Billion Credit Facility

Ross Stores, Inc. announced on June 27, 2025, the establishment of a new senior unsecured revolving credit facility, the 2025 Credit Facility, which provides up to $1.3 billion in borrowing availability. This facility replaces the previous credit facility from February 2022, maintaining similar terms and borrowing capacity limits, and includes options for extension and increased size. The new facility is expected to enhance Ross Stores’ financial flexibility and support its operational needs, with no outstanding borrowings reported on the effective date.