Ross Stores, Inc.: Investment Report

Overview

Ross Stores, Inc. is a leading off-price retailer in the United States, operating under the Ross Dress for Less and dd's DISCOUNTS brand names. With a strong track record of profitable growth and a robust business model, Ross Stores has established itself as a compelling investment opportunity. This report provides an in-depth analysis of the company's financial performance, growth prospects, and market trends, making a compelling case for investment.

Core Metrics

• Current price: $152.68 USD
• 52-week high: $163.60 USD
• 52-week low: $108.35 USD
• Market Cap: $50.65 billion USD
• P/E Ratio: 24.63
• Earnings per Share: $6.20
• 50-day average: $146.53 USD
• 200-day average: $141.44 USD
• Analyst Recommendations: Buy (19 analysts)

Financial Performance

Ross Stores has demonstrated a strong financial performance in recent years, driven by its successful off-price business model. The company's revenue has grown steadily, with a CAGR of 7.1% over the past three years. Gross margins have remained robust at 32.5%, while EBITDA margins have expanded to 14.1%. The company's strong cash generation has enabled it to invest in growth initiatives and return capital to shareholders through share repurchases and dividends.

Growth Prospects

Ross Stores has a solid growth trajectory ahead, driven by its plans to expand its store count, enhance its e-commerce capabilities, and invest in digital marketing. The company's off-price model is well-positioned to benefit from the ongoing shift towards value-conscious consumer spending. Additionally, Ross Stores has a strong track record of successfully integrating acquisitions, which provides a potential source of future growth.

News and Updates

Recent news articles highlight Ross Stores' technical strength, with the stock crossing above its 20-day moving average, suggesting a short-term bullish trend. Additionally, the company's Executive Chairman, Michael Balmuth, has sold 14,887 shares of the company, indicating a degree of insider selling.

Upgrades and Downgrades

Telsey Advisory Group has maintained its Market Perform rating on Ross Stores, while Morgan Stanley, Wells Fargo, and Barclays have reiterated their Overweight rating. TD Cowen and Loop Capital have maintained their Buy rating, highlighting the company's strong growth prospects.

Summary

In conclusion, Ross Stores, Inc. presents a compelling investment opportunity, driven by its strong financial performance, growth prospects, and solid track record of profitable growth. With a robust business model, a solid balance sheet, and a favorable industry backdrop, Ross Stores is well-positioned to continue delivering value to shareholders. We recommend a Buy rating on the stock, with a price target of $165.00 USD.

Disclosures

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