Ross Stores (ROST) Stock Forecast & Price Target

Ross Stores has demonstrated solid financial performance, achieving a 4.6% increase in total sales to $5.53 billion in Q2, aligning closely with analyst expectations and within company guidance. The company anticipates sales growth of 6% to 8% year-over-year, which exceeds prior consensus estimates, showcasing optimistic outlook and strength across multiple merchandise categories and regions. Additionally, the positive trends in customer traffic and average transaction sizes suggest an encouraging trajectory for ongoing sales improvements, positioning Ross Stores favorably in the retail landscape.

Ross Stores is experiencing a projected decline in earnings per share (EPS) for the third quarter, with estimates ranging from $1.31 to $1.37, down from last year's EPS of $1.48. Additionally, net interest income is anticipated to decrease significantly, from $43 million in the previous year to approximately $27 million, indicating potential challenges in managing financial expenses. Operating margins are also forecasted to deteriorate, with an expected 150 basis points decline, reflecting ongoing pressures despite stable selling, general, and administrative (SG&A) costs as a percentage of sales.