ROSS STORES INC (ROST) Stock Fundamental Analysis
USA - NASDAQ:ROST - US7782961038 - Common Stock
156.31 USD
+1.1 (+0.71%)
156.31 USD
0 (0%)
We assign a fundamental rating of 7 out of 10 to ROST. ROST was compared to 120 industry peers in the Specialty Retail industry. Both the health and profitability get an excellent rating, making ROST a very profitable company, without any liquidiy or solvency issues. ROST has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year ROST was profitable.
ROST had a positive operating cash flow in the past year.
Each year in the past 5 years ROST has been profitable.
Each year in the past 5 years ROST had a positive operating cash flow.
1.2 Ratios
ROST has a better Return On Assets (14.23%) than 88.33% of its industry peers.
ROST has a Return On Equity of 35.98%. This is amongst the best in the industry. ROST outperforms 88.33% of its industry peers.
Looking at the Return On Invested Capital, with a value of 19.36%, ROST belongs to the top of the industry, outperforming 88.33% of the companies in the same industry.
ROST had an Average Return On Invested Capital over the past 3 years of 17.29%. This is significantly above the industry average of 12.17%.
The last Return On Invested Capital (19.36%) for ROST is above the 3 year average (17.29%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.23% | ||
| ROE | 35.98% | ||
| ROIC | 19.36% |
ROA(3y)12.8%
ROA(5y)10.34%
ROE(3y)37.23%
ROE(5y)31.34%
ROIC(3y)17.29%
ROIC(5y)14.87%
1.3 Margins
Looking at the Profit Margin, with a value of 9.60%, ROST belongs to the top of the industry, outperforming 88.33% of the companies in the same industry.
In the last couple of years the Profit Margin of ROST has remained more or less at the same level.
The Operating Margin of ROST (12.00%) is better than 86.67% of its industry peers.
In the last couple of years the Operating Margin of ROST has declined.
ROST has a Gross Margin of 27.61%. This is in the lower half of the industry: ROST underperforms 70.00% of its industry peers.
ROST's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12% | ||
| PM (TTM) | 9.6% | ||
| GM | 27.61% |
OM growth 3Y-0.26%
OM growth 5Y-1.77%
PM growth 3Y2.8%
PM growth 5Y-0.91%
GM growth 3Y0.3%
GM growth 5Y-0.21%
2. Health
2.1 Basic Checks
ROST has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for ROST has been reduced compared to 1 year ago.
ROST has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, ROST has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 6.16 indicates that ROST is not in any danger for bankruptcy at the moment.
ROST's Altman-Z score of 6.16 is amongst the best of the industry. ROST outperforms 90.83% of its industry peers.
ROST has a debt to FCF ratio of 0.90. This is a very positive value and a sign of high solvency as it would only need 0.90 years to pay back of all of its debts.
ROST's Debt to FCF ratio of 0.90 is amongst the best of the industry. ROST outperforms 80.83% of its industry peers.
A Debt/Equity ratio of 0.18 indicates that ROST is not too dependend on debt financing.
ROST has a Debt to Equity ratio of 0.18. This is in the better half of the industry: ROST outperforms 64.17% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.18 | ||
| Debt/FCF | 0.9 | ||
| Altman-Z | 6.16 |
ROIC/WACC2.09
WACC9.28%
2.3 Liquidity
A Current Ratio of 1.58 indicates that ROST should not have too much problems paying its short term obligations.
With a decent Current ratio value of 1.58, ROST is doing good in the industry, outperforming 69.17% of the companies in the same industry.
ROST has a Quick Ratio of 1.58. This is a bad value and indicates that ROST is not financially healthy enough and could expect problems in meeting its short term obligations.
ROST's Quick ratio of 0.98 is fine compared to the rest of the industry. ROST outperforms 75.83% of its industry peers.
ROST does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.58 | ||
| Quick Ratio | 0.98 |
3. Growth
3.1 Past
ROST shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 1.61%.
ROST shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.56% yearly.
The Revenue has been growing slightly by 1.92% in the past year.
The Revenue has been growing slightly by 5.67% on average over the past years.
EPS 1Y (TTM)1.61%
EPS 3Y9.15%
EPS 5Y6.56%
EPS Q2Q%-1.89%
Revenue 1Y (TTM)1.92%
Revenue growth 3Y3.76%
Revenue growth 5Y5.67%
Sales Q2Q%4.57%
3.2 Future
The Earnings Per Share is expected to grow by 8.47% on average over the next years. This is quite good.
The Revenue is expected to grow by 4.87% on average over the next years.
EPS Next Y0.21%
EPS Next 2Y4.98%
EPS Next 3Y7.41%
EPS Next 5Y8.47%
Revenue Next Year3.88%
Revenue Next 2Y4.43%
Revenue Next 3Y4.66%
Revenue Next 5Y4.87%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 24.81 indicates a rather expensive valuation of ROST.
66.67% of the companies in the same industry are more expensive than ROST, based on the Price/Earnings ratio.
ROST is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.40, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 22.44, which indicates a rather expensive current valuation of ROST.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ROST is on the same level as its industry peers.
ROST's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 22.94.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.81 | ||
| Fwd PE | 22.44 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ROST is on the same level as its industry peers.
Based on the Price/Free Cash Flow ratio, ROST is valued a bit cheaper than the industry average as 63.33% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.29 | ||
| EV/EBITDA | 15.78 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ROST does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of ROST may justify a higher PE ratio.
PEG (NY)116.63
PEG (5Y)3.78
EPS Next 2Y4.98%
EPS Next 3Y7.41%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.04%, ROST has a reasonable but not impressive dividend return.
ROST's Dividend Yield is a higher than the industry average which is at 5.54.
With a Dividend Yield of 1.04, ROST pays less dividend than the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.04% |
5.2 History
The dividend of ROST is nicely growing with an annual growth rate of 7.61%!
ROST has been paying a dividend for at least 10 years, so it has a reliable track record.
ROST has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)7.61%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
ROST pays out 24.66% of its income as dividend. This is a sustainable payout ratio.
The dividend of ROST is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP24.66%
EPS Next 2Y4.98%
EPS Next 3Y7.41%
156.31
+1.1 (+0.71%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners94.42%
Inst Owner Change0.04%
Ins Owners2.08%
Ins Owner Change-3.11%
Market Cap50.84B
Analysts82.4
Price Target163.15 (4.38%)
Short Float %1.78%
Short Ratio2
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.04% |
Yearly Dividend1.47
Dividend Growth(5Y)7.61%
DP24.66%
Div Incr Years4
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.19%
Min EPS beat(2)-0.39%
Max EPS beat(2)0%
EPS beat(4)3
Avg EPS beat(4)2.38%
Min EPS beat(4)-0.39%
Max EPS beat(4)5.99%
EPS beat(8)7
Avg EPS beat(8)4.34%
EPS beat(12)11
Avg EPS beat(12)5.96%
EPS beat(16)14
Avg EPS beat(16)6.99%
Revenue beat(2)0
Avg Revenue beat(2)-2.22%
Min Revenue beat(2)-2.76%
Max Revenue beat(2)-1.68%
Revenue beat(4)0
Avg Revenue beat(4)-2.62%
Min Revenue beat(4)-3.38%
Max Revenue beat(4)-1.68%
Revenue beat(8)1
Avg Revenue beat(8)-1.51%
Revenue beat(12)3
Avg Revenue beat(12)-0.91%
Revenue beat(16)4
Avg Revenue beat(16)-1.07%
PT rev (1m)0.63%
PT rev (3m)5.67%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-6.48%
EPS NY rev (1m)0.26%
EPS NY rev (3m)0.06%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.28%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.09%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.81 | ||
| Fwd PE | 22.44 | ||
| P/S | 2.36 | ||
| P/FCF | 30.29 | ||
| P/OCF | 20.55 | ||
| P/B | 8.87 | ||
| P/tB | 8.87 | ||
| EV/EBITDA | 15.78 |
EPS(TTM)6.3
EY4.03%
EPS(NY)6.96
Fwd EY4.46%
FCF(TTM)5.16
FCFY3.3%
OCF(TTM)7.61
OCFY4.87%
SpS66.1
BVpS17.63
TBVpS17.63
PEG (NY)116.63
PEG (5Y)3.78
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.23% | ||
| ROE | 35.98% | ||
| ROCE | 25.54% | ||
| ROIC | 19.36% | ||
| ROICexc | 31.27% | ||
| ROICexgc | 31.27% | ||
| OM | 12% | ||
| PM (TTM) | 9.6% | ||
| GM | 27.61% | ||
| FCFM | 7.81% |
ROA(3y)12.8%
ROA(5y)10.34%
ROE(3y)37.23%
ROE(5y)31.34%
ROIC(3y)17.29%
ROIC(5y)14.87%
ROICexc(3y)32.61%
ROICexc(5y)29.08%
ROICexgc(3y)32.61%
ROICexgc(5y)29.08%
ROCE(3y)22.8%
ROCE(5y)19.61%
ROICexcg growth 3Y-3.26%
ROICexcg growth 5Y2.96%
ROICexc growth 3Y-3.26%
ROICexc growth 5Y2.96%
OM growth 3Y-0.26%
OM growth 5Y-1.77%
PM growth 3Y2.8%
PM growth 5Y-0.91%
GM growth 3Y0.3%
GM growth 5Y-0.21%
F-Score8
Asset Turnover1.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.18 | ||
| Debt/FCF | 0.9 | ||
| Debt/EBITDA | 0.33 | ||
| Cap/Depr | 168.77% | ||
| Cap/Sales | 3.7% | ||
| Interest Coverage | 33.9 | ||
| Cash Conversion | 81.08% | ||
| Profit Quality | 81.37% | ||
| Current Ratio | 1.58 | ||
| Quick Ratio | 0.98 | ||
| Altman-Z | 6.16 |
F-Score8
WACC9.28%
ROIC/WACC2.09
Cap/Depr(3y)169.59%
Cap/Depr(5y)154.94%
Cap/Sales(3y)3.55%
Cap/Sales(5y)3.37%
Profit Quality(3y)80.07%
Profit Quality(5y)494.81%
High Growth Momentum
Growth
EPS 1Y (TTM)1.61%
EPS 3Y9.15%
EPS 5Y6.56%
EPS Q2Q%-1.89%
EPS Next Y0.21%
EPS Next 2Y4.98%
EPS Next 3Y7.41%
EPS Next 5Y8.47%
Revenue 1Y (TTM)1.92%
Revenue growth 3Y3.76%
Revenue growth 5Y5.67%
Sales Q2Q%4.57%
Revenue Next Year3.88%
Revenue Next 2Y4.43%
Revenue Next 3Y4.66%
Revenue Next 5Y4.87%
EBIT growth 1Y1.39%
EBIT growth 3Y3.49%
EBIT growth 5Y3.8%
EBIT Next Year20.21%
EBIT Next 3Y9.8%
EBIT Next 5Y10.01%
FCF growth 1Y-19.6%
FCF growth 3Y11.5%
FCF growth 5Y0.26%
OCF growth 1Y-13.56%
OCF growth 3Y10.67%
OCF growth 5Y1.65%