ROSS STORES INC (ROST) Stock Fundamental Analysis
NASDAQ:ROST - Nasdaq - US7782961038 - Common Stock - Currency: USD
Taking everything into account, ROST scores 6 out of 10 in our fundamental rating. ROST was compared to 120 industry peers in the Specialty Retail industry. ROST gets an excellent profitability rating and is at the same time showing great financial health properties. ROST has a decent growth rate and is not valued too expensively. These ratings would make ROST suitable for quality investing!
1. Profitability
1.1 Basic Checks
In the past year ROST was profitable.
In the past year ROST had a positive cash flow from operations.
ROST had positive earnings in each of the past 5 years.
In the past 5 years ROST always reported a positive cash flow from operatings.
1.2 Ratios
ROST's Return On Assets of 14.18% is amongst the best of the industry. ROST outperforms 89.74% of its industry peers.
ROST has a Return On Equity of 40.16%. This is amongst the best in the industry. ROST outperforms 87.18% of its industry peers.
The Return On Invested Capital of ROST (19.62%) is better than 88.03% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ROST is above the industry average of 12.30%.
The last Return On Invested Capital (19.62%) for ROST is above the 3 year average (17.20%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.18% | ||
| ROE | 40.16% | ||
| ROIC | 19.62% |
ROA(3y)12.34%
ROA(5y)11.09%
ROE(3y)38.72%
ROE(5y)33.64%
ROIC(3y)17.2%
ROIC(5y)15.97%
1.3 Margins
ROST has a Profit Margin of 9.95%. This is amongst the best in the industry. ROST outperforms 91.45% of its industry peers.
In the last couple of years the Profit Margin of ROST has declined.
ROST's Operating Margin of 12.23% is amongst the best of the industry. ROST outperforms 87.18% of its industry peers.
In the last couple of years the Operating Margin of ROST has declined.
ROST has a Gross Margin of 28.00%. This is in the lower half of the industry: ROST underperforms 70.09% of its industry peers.
ROST's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.23% | ||
| PM (TTM) | 9.95% | ||
| GM | 28% |
OM growth 3Y48.89%
OM growth 5Y-3.63%
PM growth 3Y138.48%
PM growth 5Y-2.78%
GM growth 3Y8.39%
GM growth 5Y-0.75%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), ROST is creating value.
The number of shares outstanding for ROST has been reduced compared to 1 year ago.
The number of shares outstanding for ROST has been reduced compared to 5 years ago.
The debt/assets ratio for ROST has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 5.45 indicates that ROST is not in any danger for bankruptcy at the moment.
The Altman-Z score of ROST (5.45) is better than 88.03% of its industry peers.
The Debt to FCF ratio of ROST is 1.31, which is an excellent value as it means it would take ROST, only 1.31 years of fcf income to pay off all of its debts.
ROST has a better Debt to FCF ratio (1.31) than 78.63% of its industry peers.
A Debt/Equity ratio of 0.29 indicates that ROST is not too dependend on debt financing.
ROST has a Debt to Equity ratio (0.29) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 1.31 | ||
| Altman-Z | 5.45 |
ROIC/WACC1.94
WACC10.09%
2.3 Liquidity
A Current Ratio of 1.57 indicates that ROST should not have too much problems paying its short term obligations.
With a decent Current ratio value of 1.57, ROST is doing good in the industry, outperforming 66.67% of the companies in the same industry.
A Quick Ratio of 0.98 indicates that ROST may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.98, ROST is in the better half of the industry, outperforming 74.36% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.57 | ||
| Quick Ratio | 0.98 |
3. Growth
3.1 Past
ROST shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 25.74%, which is quite impressive.
Measured over the past 5 years, ROST shows a small growth in Earnings Per Share. The EPS has been growing by 6.81% on average per year.
ROST shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.54%.
The Revenue has been growing slightly by 6.34% on average over the past years.
EPS 1Y (TTM)25.74%
EPS 3Y84.87%
EPS 5Y6.81%
EPS Q2Q%11.28%
Revenue 1Y (TTM)8.54%
Revenue growth 3Y17.59%
Revenue growth 5Y6.34%
Sales Q2Q%2.97%
3.2 Future
ROST is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.62% yearly.
Based on estimates for the next years, ROST will show a small growth in Revenue. The Revenue will grow by 6.08% on average per year.
EPS Next Y13.51%
EPS Next 2Y11.05%
EPS Next 3Y10.43%
EPS Next 5Y11.62%
Revenue Next Year5.1%
Revenue Next 2Y5.26%
Revenue Next 3Y5.22%
Revenue Next 5Y6.08%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 21.51 indicates a rather expensive valuation of ROST.
ROST's Price/Earnings ratio is a bit cheaper when compared to the industry. ROST is cheaper than 65.81% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.63, ROST is valued a bit cheaper.
With a Price/Forward Earnings ratio of 19.92, ROST is valued on the expensive side.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ROST indicates a somewhat cheap valuation: ROST is cheaper than 60.68% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.68. ROST is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.51 | ||
| Fwd PE | 19.92 |
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.
ROST's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. ROST is cheaper than 64.96% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.72 | ||
| EV/EBITDA | 14.36 |
4.3 Compensation for Growth
ROST's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of ROST may justify a higher PE ratio.
PEG (NY)1.59
PEG (5Y)3.16
EPS Next 2Y11.05%
EPS Next 3Y10.43%
5. Dividend
5.1 Amount
ROST has a Yearly Dividend Yield of 1.06%.
Compared to an average industry Dividend Yield of 4.01, ROST pays a bit more dividend than its industry peers.
With a Dividend Yield of 1.06, ROST pays less dividend than the S&P500 average, which is at 2.29.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
5.2 History
The dividend of ROST is nicely growing with an annual growth rate of 8.27%!
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)8.27%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
ROST pays out 22.72% of its income as dividend. This is a sustainable payout ratio.
The dividend of ROST is growing, but earnings are growing more, so the dividend growth is sustainable.
DP22.72%
EPS Next 2Y11.05%
EPS Next 3Y10.43%
136.61
-2.48 (-1.78%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners94.25%
Inst Owner Change2.57%
Ins Owners2.06%
Ins Owner Change3.81%
Market Cap45.07B
Analysts78.57
Price Target171.67 (25.66%)
Short Float %1.57%
Short Ratio2.18
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
Yearly Dividend1.34
Dividend Growth(5Y)8.27%
DP22.72%
Div Incr Years3
Div Non Decr Years3
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.03%
Min EPS beat(2)3.93%
Max EPS beat(2)4.13%
EPS beat(4)4
Avg EPS beat(4)5.59%
Min EPS beat(4)3.93%
Max EPS beat(4)7.9%
EPS beat(8)8
Avg EPS beat(8)5.64%
EPS beat(12)11
Avg EPS beat(12)5.82%
EPS beat(16)14
Avg EPS beat(16)9.99%
Revenue beat(2)0
Avg Revenue beat(2)-2.3%
Min Revenue beat(2)-3.38%
Max Revenue beat(2)-1.22%
Revenue beat(4)1
Avg Revenue beat(4)-1.13%
Min Revenue beat(4)-3.38%
Max Revenue beat(4)1.54%
Revenue beat(8)2
Avg Revenue beat(8)-0.78%
Revenue beat(12)3
Avg Revenue beat(12)-1.12%
Revenue beat(16)6
Avg Revenue beat(16)0.42%
PT rev (1m)-1.06%
PT rev (3m)-2.39%
EPS NQ rev (1m)-0.1%
EPS NQ rev (3m)-3.49%
EPS NY rev (1m)-0.02%
EPS NY rev (3m)0.61%
Revenue NQ rev (1m)-0.2%
Revenue NQ rev (3m)-0.87%
Revenue NY rev (1m)0.06%
Revenue NY rev (3m)-0.65%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.51 | ||
| Fwd PE | 19.92 | ||
| P/S | 2.12 | ||
| P/FCF | 26.72 | ||
| P/OCF | 18.6 | ||
| P/B | 8.56 | ||
| P/tB | 8.56 | ||
| EV/EBITDA | 14.36 |
EPS(TTM)6.35
EY4.65%
EPS(NY)6.86
Fwd EY5.02%
FCF(TTM)5.11
FCFY3.74%
OCF(TTM)7.34
OCFY5.38%
SpS64.38
BVpS15.95
TBVpS15.95
PEG (NY)1.59
PEG (5Y)3.16
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.18% | ||
| ROE | 40.16% | ||
| ROCE | 25.83% | ||
| ROIC | 19.62% | ||
| ROICexc | 34.56% | ||
| ROICexgc | 34.56% | ||
| OM | 12.23% | ||
| PM (TTM) | 9.95% | ||
| GM | 28% | ||
| FCFM | 7.94% |
ROA(3y)12.34%
ROA(5y)11.09%
ROE(3y)38.72%
ROE(5y)33.64%
ROIC(3y)17.2%
ROIC(5y)15.97%
ROICexc(3y)33.91%
ROICexc(5y)28.16%
ROICexgc(3y)33.91%
ROICexgc(5y)28.16%
ROCE(3y)22.64%
ROCE(5y)21.02%
ROICexcg growth 3Y59.08%
ROICexcg growth 5Y-10.57%
ROICexc growth 3Y59.08%
ROICexc growth 5Y-10.57%
OM growth 3Y48.89%
OM growth 5Y-3.63%
PM growth 3Y138.48%
PM growth 5Y-2.78%
GM growth 3Y8.39%
GM growth 5Y-0.75%
F-Score8
Asset Turnover1.42
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 1.31 | ||
| Debt/EBITDA | 0.5 | ||
| Cap/Depr | 164.15% | ||
| Cap/Sales | 3.47% | ||
| Interest Coverage | 32.35 | ||
| Cash Conversion | 79.52% | ||
| Profit Quality | 79.8% | ||
| Current Ratio | 1.57 | ||
| Quick Ratio | 0.98 | ||
| Altman-Z | 5.45 |
F-Score8
WACC10.09%
ROIC/WACC1.94
Cap/Depr(3y)167.41%
Cap/Depr(5y)154.37%
Cap/Sales(3y)3.4%
Cap/Sales(5y)3.38%
Profit Quality(3y)76.82%
Profit Quality(5y)498.61%
High Growth Momentum
Growth
EPS 1Y (TTM)25.74%
EPS 3Y84.87%
EPS 5Y6.81%
EPS Q2Q%11.28%
EPS Next Y13.51%
EPS Next 2Y11.05%
EPS Next 3Y10.43%
EPS Next 5Y11.62%
Revenue 1Y (TTM)8.54%
Revenue growth 3Y17.59%
Revenue growth 5Y6.34%
Sales Q2Q%2.97%
Revenue Next Year5.1%
Revenue Next 2Y5.26%
Revenue Next 3Y5.22%
Revenue Next 5Y6.08%
EBIT growth 1Y22.44%
EBIT growth 3Y75.08%
EBIT growth 5Y2.49%
EBIT Next Year33.79%
EBIT Next 3Y16.08%
EBIT Next 5Y13.63%
FCF growth 1Y1433.37%
FCF growth 3Y-1.64%
FCF growth 5Y1.17%
OCF growth 1Y242.36%
OCF growth 3Y3.84%
OCF growth 5Y4%