ROSS STORES INC (ROST) Stock Fundamental Analysis
NASDAQ:ROST - Nasdaq - US7782961038 - Common Stock
Taking everything into account, ROST scores 6 out of 10 in our fundamental rating. ROST was compared to 119 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 correct valuation and a medium growth rate. With these ratings, ROST could be worth investigating further 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.
Each year in the past 5 years ROST has been profitable.
ROST had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
ROST has a Return On Assets of 14.18%. This is amongst the best in the industry. ROST outperforms 89.66% of its industry peers.
ROST has a Return On Equity of 40.16%. This is amongst the best in the industry. ROST outperforms 87.07% of its industry peers.
ROST has a better Return On Invested Capital (19.62%) than 87.93% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ROST is above the industry average of 12.38%.
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 91.38% 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 87.93% of its industry peers.
ROST's Operating Margin has declined in the last couple of years.
The Gross Margin of ROST (28.00%) is worse than 69.83% 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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so 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.
Compared to 1 year ago, ROST has an improved debt to assets ratio.
2.2 Solvency
ROST has an Altman-Z score of 5.65. This indicates that ROST is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of ROST (5.65) is better than 87.07% of its industry peers.
ROST has a debt to FCF ratio of 1.31. This is a very positive value and a sign of high solvency as it would only need 1.31 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 1.31, ROST belongs to the best of the industry, outperforming 81.03% of the companies in the same industry.
ROST has a Debt/Equity ratio of 0.29. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.29, ROST is in line with its industry, outperforming 56.90% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 1.31 | ||
| Altman-Z | 5.65 |
ROIC/WACC1.96
WACC10.02%
2.3 Liquidity
ROST has a Current Ratio of 1.57. This is a normal value and indicates that ROST is financially healthy and should not expect problems in meeting its short term obligations.
ROST has a Current ratio of 1.57. This is in the better half of the industry: ROST outperforms 67.24% of its industry peers.
ROST has a Quick Ratio of 1.57. This is a bad value and indicates that ROST is not financially healthy enough and could expect problems in meeting 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 75.86% 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.
ROST shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.81% yearly.
The Revenue has grown by 8.54% in the past year. This is quite good.
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
Based on estimates for the next years, ROST will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.62% on average per year.
ROST is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.08% yearly.
EPS Next Y13.54%
EPS Next 2Y11.09%
EPS Next 3Y10.46%
EPS Next 5Y11.62%
Revenue Next Year5.04%
Revenue Next 2Y5.23%
Revenue Next 3Y5.23%
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.
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 23.59 indicates a rather expensive valuation of ROST.
Based on the Price/Earnings ratio, ROST is valued a bit cheaper than the industry average as 61.21% of the companies are valued more expensively.
ROST's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 28.29.
Based on the Price/Forward Earnings ratio of 21.83, the valuation of ROST can be described as rather expensive.
ROST's Price/Forward Earnings is on the same level as the industry average.
ROST's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 24.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.59 | ||
| Fwd PE | 21.83 |
4.2 Price Multiples
ROST's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, ROST is valued a bit cheaper than 65.52% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 29.3 | ||
| EV/EBITDA | 15.43 |
4.3 Compensation for Growth
The 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)1.74
PEG (5Y)3.46
EPS Next 2Y11.09%
EPS Next 3Y10.46%
5. Dividend
5.1 Amount
With a yearly dividend of 0.99%, ROST is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.27, ROST pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.99, ROST pays less dividend than the S&P500 average, which is at 2.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.99% |
5.2 History
On average, the dividend of ROST grows each year by 8.27%, which is quite nice.
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
22.72% of the earnings are spent on dividend by ROST. This is a low number and sustainable payout ratio.
The dividend of ROST is growing, but earnings are growing more, so the dividend growth is sustainable.
DP22.72%
EPS Next 2Y11.09%
EPS Next 3Y10.46%
ROSS STORES INC
NASDAQ:ROST (1/22/2025, 4:36:18 PM)
After market: 149.79 0 (0%)149.79
+0.85 (+0.57%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners91.82%
Inst Owner Change0.57%
Ins Owners2.07%
Ins Owner Change3.81%
Market Cap49.42B
Analysts81.38
Price Target173.51 (15.84%)
Short Float %1.58%
Short Ratio1.84
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.99% |
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)0.03%
PT rev (3m)-2.69%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-3.4%
EPS NY rev (1m)0%
EPS NY rev (3m)0.6%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.67%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)-0.24%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.59 | ||
| Fwd PE | 21.83 | ||
| P/S | 2.33 | ||
| P/FCF | 29.3 | ||
| P/OCF | 20.39 | ||
| P/B | 9.39 | ||
| P/tB | 9.39 | ||
| EV/EBITDA | 15.43 |
EPS(TTM)6.35
EY4.24%
EPS(NY)6.86
Fwd EY4.58%
FCF(TTM)5.11
FCFY3.41%
OCF(TTM)7.34
OCFY4.9%
SpS64.38
BVpS15.95
TBVpS15.95
PEG (NY)1.74
PEG (5Y)3.46
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 | 5.65 |
F-Score8
WACC10.02%
ROIC/WACC1.96
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 Y13.54%
EPS Next 2Y11.09%
EPS Next 3Y10.46%
EPS Next 5Y11.62%
Revenue 1Y (TTM)8.54%
Revenue growth 3Y17.59%
Revenue growth 5Y6.34%
Sales Q2Q%2.97%
Revenue Next Year5.04%
Revenue Next 2Y5.23%
Revenue Next 3Y5.23%
Revenue Next 5Y6.08%
EBIT growth 1Y22.44%
EBIT growth 3Y75.08%
EBIT growth 5Y2.49%
EBIT Next Year33.79%
EBIT Next 3Y16.07%
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%