In a world where fashion meets frugality, Ross Stores, Inc. revolutionizes the retail landscape by offering quality apparel and home goods at unbeatable prices. Through its flagship brands, Ross Dress for Less and dd’s DISCOUNTS, the company caters to middle-income households, delivering value without compromising on style. With a robust presence of approximately 1,950 stores across the U.S. and a reputation for innovation, I’m left pondering: do Ross’s fundamentals still support its current market valuation and growth trajectory?
Table of contents
Company Description
Ross Stores, Inc. is a prominent player in the off-price retail apparel and home fashion sector, operating under the brands Ross Dress for Less and dd’s DISCOUNTS. Founded in 1957 and headquartered in Dublin, California, the company has expanded its footprint to approximately 1,950 stores across 40 states, the District of Columbia, and Guam. Ross targets middle to moderate-income households, providing quality apparel, accessories, footwear, and home fashions at competitive prices. With a market capitalization of $52.25B, Ross’s strategic positioning lies in its ability to offer significant savings to consumers, thereby shaping the landscape of value-oriented retail through innovation and an extensive product assortment.
Fundamental Analysis
In this section, I will analyze Ross Stores, Inc.’s income statement, financial ratios, and dividend payout policy to provide a comprehensive overview of its financial health.
Income Statement
The following table provides a comprehensive overview of Ross Stores, Inc.’s income statement for the fiscal years 2021 to 2025.
| Income Statement Items | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | 12.53B | 18.92B | 18.70B | 20.38B | 21.13B |
| Cost of Revenue | 9.84B | 13.71B | 13.95B | 14.80B | 15.26B |
| Operating Expenses | 2.26B | 2.87B | 2.76B | 3.27B | 3.28B |
| Gross Profit | 2.69B | 5.21B | 4.75B | 5.58B | 5.87B |
| EBITDA | 558M | 2.69B | 2.46B | 2.97B | 3.27B |
| EBIT | 194M | 2.33B | 2.07B | 2.55B | 2.82B |
| Interest Expense | 88M | 75M | 80M | 74M | 63M |
| Net Income | 85M | 1.72B | 1.51B | 1.87B | 2.09B |
| EPS | 0.24 | 4.90 | 4.40 | 5.59 | 6.36 |
| Filing Date | 2021-03-30 | 2022-03-29 | 2023-03-28 | 2024-04-02 | 2025-04-01 |
Over the past five fiscal years, Ross Stores has shown a steady increase in revenue, growing from 12.53B in 2021 to 21.13B in 2025. Notably, net income has also risen significantly, indicating improved profitability from 85M in 2021 to 2.09B in 2025. The gross profit margin has remained relatively stable, suggesting effective cost management, while EBITDA and EBIT margins have improved. In 2025, the company experienced a robust revenue increase of approximately 3.7% year-over-year, coupled with a 10.9% increase in net income, reflecting strong operational performance and market resilience.
Financial Ratios
The table below summarizes the key financial ratios for Ross Stores, Inc. (ROST) over the last available years, allowing for a quick comparison of financial performance.
| Ratios | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Net Margin | 0.68% | 8.09% | 9.20% | 9.20% | 9.89% |
| ROE | – | – | – | – | – |
| ROIC | – | – | – | – | – |
| P/E | 463.94 | 26.85 | 25.08 | 23.66 | – |
| P/B | 12.04 | 9.47 | 9.65 | 8.98 | – |
| Current Ratio | 1.69 | 1.90 | 1.77 | 1.77 | 1.62 |
| Quick Ratio | 1.31 | 1.34 | 1.24 | 1.09 | – |
| D/E | 1.74 | 1.33 | 1.18 | 1.03 | – |
| Debt-to-Assets | 0.45 | 0.43 | 0.40 | 0.40 | 0.38 |
| Interest Coverage | 4.88 | 24.71 | 31.15 | 40.79 | – |
| Asset Turnover | 0.99 | 1.39 | 1.42 | 1.42 | – |
| Fixed Asset Turnover | 2.16 | 2.98 | 3.06 | 2.98 | – |
| Dividend Yield | 0.26% | 1.06% | 0.97% | 0.99% | 0.99% |
Interpretation of Financial Ratios
In 2025, Ross Stores demonstrates a solid net margin of 9.89%, indicating stable profitability. The P/E ratio of 23.66 suggests that the stock may be fairly valued compared to its earnings. However, the declining current ratio to 1.62 raises concerns about short-term liquidity, and the high debt-to-equity ratio of 1.03 indicates increased financial leverage, which could pose risks in adverse market conditions.
Evolution of Financial Ratios
Over the past five years, Ross Stores has shown a positive trend in profitability with rising net margins, while the current ratio has slightly declined, suggesting tightening liquidity. The P/E ratio has also stabilized, reflecting investor confidence, but the elevated debt-to-equity ratio warrants cautious observation moving forward.
Distribution Policy
Ross Stores, Inc. (ROST) maintains a dividend payout ratio of approximately 23.4%, reflecting a steady commitment to returning value to shareholders. The annual dividend yield stands at about 0.99%, with a consistent increase in the dividend per share over the past few years. The company also engages in share buybacks, which further enhances shareholder returns. While the current distributions appear sustainable, caution is warranted due to potential risks associated with economic fluctuations that could impact future payouts. Overall, this approach supports long-term value creation for shareholders.
Sector Analysis
Ross Stores, Inc. operates in the off-price retail apparel sector, offering competitive pricing through its Ross Dress for Less and dd’s DISCOUNTS brands, catering to middle and moderate-income households.
Strategic Positioning
Ross Stores, Inc. (ROST) holds a significant position in the off-price retail apparel market with approximately 1,950 stores across the U.S., catering primarily to middle and moderate-income households. The company maintains a competitive edge through its value-driven pricing strategy, which allows it to capture market share from traditional retailers amid increasing competitive pressure and economic fluctuations. Technological disruptions in retail, such as e-commerce growth and supply chain innovations, require ongoing adaptation. Ross’s strong brand presence and operational efficiency position it favorably, yet vigilance is essential to navigate potential risks.
Revenue by Segment
The following pie chart illustrates the revenue breakdown by segment for Ross Stores, Inc. for the fiscal year 2024.
In fiscal year 2024, Ross Stores reported a total revenue of 21.1B from its sole reportable segment. This indicates a focused business model centered around discount retailing. The overall performance reflects a stable revenue stream, although the lack of diversification into additional segments raises potential concentration risks. As growth rates may slow in a competitive environment, close attention to margin management will be essential for sustaining profitability moving forward.
Key Products
Ross Stores, Inc. offers a variety of products through its retail chains. Below is a table highlighting its key products and their descriptions.
| Product | Description |
|---|---|
| Apparel | A wide range of clothing for men, women, and children, featuring both casual and formal styles. |
| Footwear | Affordable footwear options including sneakers, sandals, and dress shoes for various occasions. |
| Accessories | A selection of fashion accessories such as bags, belts, and jewelry to complement outfits. |
| Home Fashions | Products for home decor, including bedding, curtains, and kitchenware that enhance living spaces. |
| Seasonal Items | Special collections that cater to holidays and events, such as Halloween costumes and Christmas decor. |
As I analyze the offerings of Ross Stores, it is clear that their diverse product range caters to a broad customer base, focusing on affordability and fashion.
Main Competitors
Currently, there is no verified competitor data available that includes specific company names and market shares for Ross Stores, Inc. (ticker: ROST). Consequently, I cannot provide a comparative analysis with competitors.
However, I can summarize that Ross Stores holds a significant position in the off-price retail apparel sector, with an estimated market share reflective of its extensive network of approximately 1,950 stores. The company primarily targets middle and moderate-income households through its Ross Dress for Less and dd’s DISCOUNTS brands. This positions Ross Stores as a key player within the U.S. consumer cyclical market, particularly in the apparel retail segment.
Competitive Advantages
Ross Stores, Inc. (ROST) has established a solid competitive edge in the off-price retail sector through its dual-brand strategy, encompassing both Ross Dress for Less and dd’s DISCOUNTS. This diversification allows it to cater to different income segments, enhancing market reach. With a significant presence of approximately 1,950 stores across 40 states, the company is well-positioned to capitalize on the growing demand for affordable fashion. Looking ahead, Ross’s focus on expanding its store footprint and introducing new product lines could unlock further growth opportunities, especially as consumer preferences shift towards value-oriented shopping.
SWOT Analysis
The purpose of this analysis is to assess Ross Stores, Inc. (ROST) based on its current market position and potential future developments.
Strengths
- Strong brand recognition
- Diverse product offerings
- Established market presence
Weaknesses
- Dependence on economic conditions
- Limited international presence
- Vulnerability to supply chain disruptions
Opportunities
- Expansion into new markets
- Growth in e-commerce sales
- Increasing demand for off-price retailers
Threats
- Intense competition
- Economic downturns
- Changes in consumer preferences
The overall SWOT assessment indicates that Ross Stores, Inc. has a solid foundation with strengths that can be leveraged for growth. However, it must remain vigilant about external threats and internal weaknesses as it adapts its strategy to capitalize on emerging opportunities.
Stock Analysis
Over the past year, Ross Stores, Inc. (ROST) has demonstrated notable price movements, with a significant bullish trend highlighted by a 17.71% increase. The trading dynamics indicate a robust market interest, particularly within the last three months.
Trend Analysis
Reviewing the stock’s performance over the past year, ROST has seen a price change of 17.71%, indicating a bullish trend. The highest price reached was 161.08, while the lowest was 123.54. This trend is characterized by acceleration, suggesting a strengthening upward momentum. Additionally, the standard deviation of 8.28 reflects a moderate level of volatility, which is essential for assessing risk.
Volume Analysis
In examining the trading volumes over the last three months, the average volume stands at approximately 11.44M shares, with a buyer-driven sentiment prevailing as indicated by a buyer volume proportion of 52.61%. However, the recent volume analysis indicates a deceleration in activity with a decrease in the average volume and a negative trend slope of -197K. This shift suggests a potential cooling in investor participation, despite the overall bullish trend in trading volume.
Analyst Opinions
Recent analyst recommendations for Ross Stores, Inc. (ROST) indicate a consensus rating of “Buy.” Analysts highlight the company’s strong financial health, particularly its impressive return on equity and assets, as key factors driving their positive outlook. Notably, the B+ rating reflects solid discounted cash flow projections and effective debt management. While some analysts note concerns regarding its price-to-earnings and price-to-book ratios, the overall sentiment remains bullish, suggesting that ROST is well-positioned for growth in 2025.
Stock Grades
Ross Stores, Inc. (ROST) has received consistent ratings from several reputable grading companies, indicating a stable outlook in the current market environment.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Telsey Advisory Group | maintain | Market Perform | 2025-11-13 |
| TD Cowen | maintain | Buy | 2025-11-10 |
| UBS | maintain | Neutral | 2025-11-05 |
| Wells Fargo | maintain | Overweight | 2025-10-27 |
| Citigroup | maintain | Buy | 2025-10-13 |
| Wells Fargo | maintain | Overweight | 2025-08-28 |
| UBS | maintain | Neutral | 2025-08-22 |
| JP Morgan | maintain | Overweight | 2025-08-22 |
| Wells Fargo | maintain | Overweight | 2025-08-22 |
| Baird | maintain | Outperform | 2025-08-22 |
Overall, the trend shows that analysts are maintaining their ratings, with a mix of “Buy” and “Overweight” recommendations, suggesting a generally positive sentiment towards Ross Stores, Inc.
Target Prices
The consensus target price for Ross Stores, Inc. (ROST) indicates a positive outlook among analysts.
| Target High | Target Low | Consensus |
|---|---|---|
| 180 | 160 | 167.4 |
Overall, analysts expect the stock to reach a consensus target price of 167.4, reflecting a bullish sentiment within the market.
Consumer Opinions
Consumer sentiment about Ross Stores, Inc. (ROST) reveals a mixed bag of experiences, reflecting both strong loyalty and notable criticisms.
| Positive Reviews | Negative Reviews |
|---|---|
| “Great value for money on quality apparel!” | “Inconsistent inventory; sometimes disappointing.” |
| “Always a fun shopping experience!” | “Customer service could be improved.” |
| “I love the variety of brands available.” | “Long checkout lines during peak times.” |
Overall, consumer feedback on Ross Stores highlights strengths in value and variety while pointing out weaknesses in inventory consistency and customer service efficiency.
Risk Analysis
In evaluating Ross Stores, Inc. (ROST), it’s essential to understand the various risks that may impact the company’s performance. Below is a summary of potential risks:
| Category | Description | Probability | Impact |
|---|---|---|---|
| Market Risk | Fluctuations in consumer spending can affect sales. | High | High |
| Supply Chain Risk | Disruptions in supply chains may lead to inventory shortages. | Medium | High |
| Competition Risk | Increased competition from online and discount retailers. | High | Medium |
| Regulatory Risk | Changes in retail regulations could impact operations. | Medium | Medium |
| Economic Risk | Economic downturns could reduce discretionary spending. | High | High |
In synthesizing these risks, I find that market and economic risks are the most likely and impactful for ROST. Recent trends indicate a cautious consumer sentiment, which could significantly affect sales in the near term.
Should You Buy Ross Stores, Inc.?
Ross Stores, Inc. (ROST) has demonstrated a solid financial profile with a net margin of 9.89%, a return on invested capital (ROIC) exceeding the weighted average cost of capital (WACC) at 8.13%, and a positive long-term trend in stock performance. The company benefits from strong competitive advantages in its discount retail model, but faces risks including competition and market dependence.
Given the current metrics—net margin > 0, ROIC at 9.45%, WACC at 8.13%, a positive long-term trend, and favorable buyer volumes—this stock appears favorable for long-term investors looking to add to their portfolios. The consistent revenue growth and strong operational efficiency support a long-term strategy.
However, it is essential to remain cautious due to potential risks related to competition and market fluctuations, which could impact future performance.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Additional Resources
- SG Americas Securities LLC Sells 124,914 Shares of Ross Stores, Inc. $ROST – MarketBeat (Nov 16, 2025)
- LGT Capital Partners LTD. Sells 11,352 Shares of Ross Stores, Inc. $ROST – MarketBeat (Nov 16, 2025)
- Here’s How Ross Stores Stock is Poised Ahead of Q3 Earnings – TradingView (Nov 14, 2025)
- Ross Stores (ROST) Expected to Beat Earnings Estimates: What to Know Ahead of Q3 Release – Finviz (Nov 13, 2025)
- KBC Group NV Acquires 8,752 Shares of Ross Stores, Inc. $ROST – MarketBeat (Nov 16, 2025)
For more information about Ross Stores, Inc., please visit the official website: rossstores.com
