186 USD
-1.57 (-0.84%)
185.66 USD
-0.34 (-0.18%)
Overall ROST gets a fundamental rating of 7 out of 10. We evaluated ROST against 122 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.
1. Profitability
1.1 Basic Checks
- ROST had positive earnings in the past year.
- In the past year ROST had a positive cash flow from operations.
- 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's Return On Assets of 13.53% is amongst the best of the industry. ROST outperforms 89.34% of its industry peers.
- With an excellent Return On Equity value of 35.45%, ROST belongs to the best of the industry, outperforming 87.70% of the companies in the same industry.
- The Return On Invested Capital of ROST (19.14%) is better than 86.89% of its industry peers.
- ROST had an Average Return On Invested Capital over the past 3 years of 17.29%. This is significantly above the industry average of 12.24%.
- The last Return On Invested Capital (19.14%) for ROST is above the 3 year average (17.29%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.53% | ||
| ROE | 35.45% | ||
| ROIC | 19.14% |
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 9.47%, ROST belongs to the top of the industry, outperforming 87.70% of the companies in the same industry.
- ROST's Profit Margin has been stable in the last couple of years.
- The Operating Margin of ROST (11.91%) is better than 86.07% of its industry peers.
- ROST's Operating Margin has declined in the last couple of years.
- With a Gross Margin value of 27.55%, ROST is not doing good in the industry: 72.95% of the companies in the same industry are doing better.
- In the last couple of years the Gross Margin of ROST has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.91% | ||
| PM (TTM) | 9.47% | ||
| GM | 27.55% |
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
- The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so ROST is creating value.
- ROST has less shares outstanding than it did 1 year ago.
- ROST has less shares outstanding than it did 5 years ago.
- ROST has a better debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 6.44 indicates that ROST is not in any danger for bankruptcy at the moment.
- The Altman-Z score of ROST (6.44) is better than 93.44% of its industry peers.
- ROST has a debt to FCF ratio of 0.77. This is a very positive value and a sign of high solvency as it would only need 0.77 years to pay back of all of its debts.
- ROST has a better Debt to FCF ratio (0.77) than 80.33% of its industry peers.
- ROST has a Debt/Equity ratio of 0.17. This is a healthy value indicating a solid balance between debt and equity.
- The Debt to Equity ratio of ROST (0.17) is better than 63.93% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.17 | ||
| Debt/FCF | 0.77 | ||
| Altman-Z | 6.44 |
ROIC/WACC2
WACC9.57%
2.3 Liquidity
- ROST has a Current Ratio of 1.52. 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 better Current ratio (1.52) than 60.66% of its industry peers.
- A Quick Ratio of 0.90 indicates that ROST may have some problems paying its short term obligations.
- ROST has a Quick ratio of 0.90. This is in the better half of the industry: ROST outperforms 68.85% of its industry peers.
- The current and quick ratio evaluation for ROST is rather negative, while it does have 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 | 1.52 | ||
| Quick Ratio | 0.9 |
3. Growth
3.1 Past
- The Earnings Per Share has been growing slightly by 0.79% over the past year.
- ROST shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.56% yearly.
- ROST shows a small growth in Revenue. In the last year, the Revenue has grown by 3.71%.
- ROST shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.67% yearly.
EPS 1Y (TTM)0.79%
EPS 3Y9.15%
EPS 5Y6.56%
EPS Q2Q%6.76%
Revenue 1Y (TTM)3.71%
Revenue growth 3Y3.76%
Revenue growth 5Y5.67%
Sales Q2Q%10.44%
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 9.11% yearly.
- ROST is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.98% yearly.
EPS Next Y4.44%
EPS Next 2Y7.4%
EPS Next 3Y7.62%
EPS Next 5Y9.11%
Revenue Next Year6.98%
Revenue Next 2Y5.69%
Revenue Next 3Y5.4%
Revenue Next 5Y4.98%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- 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 29.06 indicates a quite expensive valuation of ROST.
- 63.93% of the companies in the same industry are more expensive than ROST, based on the Price/Earnings ratio.
- ROST's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 28.87.
- A Price/Forward Earnings ratio of 25.52 indicates a quite expensive valuation of ROST.
- 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 25.96.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.06 | ||
| Fwd PE | 25.52 |
4.2 Price Multiples
- ROST's Enterprise Value to EBITDA ratio is in line with the industry average.
- Based on the Price/Free Cash Flow ratio, ROST is valued a bit cheaper than the industry average as 61.48% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.81 | ||
| EV/EBITDA | 18.76 |
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.
- ROST has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)6.54
PEG (5Y)4.43
EPS Next 2Y7.4%
EPS Next 3Y7.62%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.87%, ROST is not a good candidate for dividend investing.
- Compared to an average industry Dividend Yield of 2.15, ROST pays a bit more dividend than its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.82, ROST's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.87% |
5.2 History
- On average, the dividend of ROST grows each year by 7.61%, which is quite nice.
- ROST has paid a dividend for at least 10 years, which is 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 24.85% of its income as dividend. This is a sustainable payout ratio.
- ROST's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP24.85%
EPS Next 2Y7.4%
EPS Next 3Y7.62%
ROSS STORES INC / ROST FAQ
What is the ChartMill fundamental rating of ROSS STORES INC (ROST) stock?
ChartMill assigns a fundamental rating of 7 / 10 to ROST.
What is the valuation status of ROSS STORES INC (ROST) stock?
ChartMill assigns a valuation rating of 4 / 10 to ROSS STORES INC (ROST). This can be considered as Fairly Valued.
How profitable is ROSS STORES INC (ROST) stock?
ROSS STORES INC (ROST) has a profitability rating of 8 / 10.
What is the valuation of ROSS STORES INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for ROSS STORES INC (ROST) is 29.06 and the Price/Book (PB) ratio is 10.28.
Is the dividend of ROSS STORES INC sustainable?
The dividend rating of ROSS STORES INC (ROST) is 5 / 10 and the dividend payout ratio is 24.85%.