Hulk Hogan, wrestling icon, dies at 71 in Florida home
On Wednesday, TD Cowen analysts adjusted their outlook on Ross Stores, Inc. (NASDAQ:ROST), reducing the price target from $175.00 to $169.00. Despite this change, the firm maintained a Buy rating on the stock. With a current market capitalization of $45 billion and a P/E ratio of 21.5, InvestingPro analysis suggests the stock is currently fairly valued. The revision follows the company’s first-quarter guidance, which suggests potential disruption but also leaves room for conservative estimates as fiscal year 2025 progresses.
Analysts at TD Cowen highlighted the consistent performance of Ross Stores, noting that outside of the two years affected by COVID-19, the company has achieved fiscal year same-store sales (SSS) growth of at least +3% since 2008. This impressive track record, coupled with a robust return on equity of 43% and revenue growth of 8.5% over the last twelve months, underscores Ross Stores’ success in gaining market share, attracting new customers, and improving productivity. InvestingPro data reveals 8 additional key performance metrics that showcase the company’s operational excellence.
The first-quarter guidance indicates an expected SSS range between -3% to flat, following a fourth-quarter SSS of +3% on top of a +7% last year (LY). This performance is comparatively higher than Marmaxx’s two-year stack of +9%. The analysts pointed out that the slight decrease in estimates and the price target reflects concerns that may already be factored into the stock’s valuation.
In their commentary, TD Cowen analysts stated, "Q1 Guidance Points to Disruption but Could Prove Conservative as FY25 Unfolds; Outside of two years distorted by COVID, Ross Stores generated FY SSS of at least +3% since 2008, a remarkable run of share gains, customer acquisition and productivity. Q1 guide of SSS -3% to flat after Q4 SSS +3% on top of +7% LY (higher than Marmaxx 2- yr stack of +9%). Our estimates and price target move slightly lower - fears over illegal immigration seem priced into valuation. Reiterate Buy."
The firm’s stance remains positive on Ross Stores, with the Buy rating reaffirmed despite the adjusted price target. The analysts’ comments suggest that while near-term challenges are acknowledged, the long-term outlook for Ross Stores continues to be favorable. Supporting this view, InvestingPro highlights the company’s 31-year track record of maintaining dividend payments and its strong financial health score of GOOD, factors that reinforce its position as a prominent player in the Specialty Retail industry. For deeper insights into Ross Stores’ valuation and growth prospects, investors can access the comprehensive Pro Research Report, which provides detailed analysis of the company’s financial metrics and future potential.
In other recent news, Ross Stores, Inc. has seen several adjustments to its stock price targets by major analyst firms following its latest earnings report. BMO Capital Markets reduced the price target to $156 while maintaining an Outperform rating, noting a bottom-line beat due to reduced expenses and a facility sale. Meanwhile, Jefferies cut the target to $145, maintaining a neutral stance, and highlighted the company’s strong fourth-quarter performance despite future concerns. Citi also adjusted its target to $146, citing a slowdown in sales trends and a conservative guidance from the new CEO. Telsey Advisory Group lowered its target to $150, pointing to sales and gross margin shortfalls, though noting some operational benefits. Bernstein, on the other hand, reduced its target to $163, maintaining a Market Perform rating, and emphasized the company’s challenges with customer traffic affecting earnings growth potential. Collectively, these revisions reflect a cautious outlook on Ross Stores’ near-term prospects amid an uncertain economic environment. Despite these adjustments, analysts like those from BMO and Jefferies recognize the potential for Ross Stores to continue attracting value-conscious consumers.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.