Ross Stores Earned $1.15 per Share

Ross Stores (ROST) just released its first-quarter earnings report. The company earned $1.15 per share. Previously, the deep-discounter had given us an earnings range of $1.05 to $1.11 per share. As usual, their guidance was conservative. Comparable store sales were up 2%.

Barbara Rentler, Chief Executive Officer, commented, “For the first quarter, we delivered sales gains at the high end of our guidance as well as better-than-expected earnings per share growth despite continued underperformance in Ladies apparel. While operating margin of 14.1% was down from the prior year, it was above plan mainly due to higher merchandise margin. As expected, this improvement was more than offset by increases in freight and wage costs and the timing of packaway-related expenses that benefited the prior year period.”

For Q2, Ross sees comparable store sales growth of 1% to 2%. For EPS, the company sees the exact same as Q1, $1.05 to $1.11 per share. Wall Street had been expecting $1.14 per share.

The company also updated its full-year guidance. Ross now sees earnings of $4.38 to $4.52 per share. That includes seven cents per share thanks to a favorable tax benefit. The previous range was $4.30 to $4.52 per share. Adjusting for that, in effect, ROST’s guidance range narrowed thanks to a one-cent increase at the low end and a five-cent decrease at the high end.

The stock is down about 2.5% after hours.

Posted by on May 23rd, 2019 at 4:40 pm


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