Ross Stores, Inc. (NASDAQ:ROST) Beats Analysts’ Expectations

Ross Stores, Inc. (NASDAQ:ROST) stock rose 12.01% (As on November 19, 11:45:18 AM UTC-4, Source: Google Finance) after the company posted better than expected results for the third quarter of FY 22. The comparable store sales down 3% on top of a robust 14% gain for the same period in 2021. Operating margin for the period was 9.8% versus 11.4% last year, reflecting the deleveraging effect from the comparable sales decline as well as pressure from higher markdowns and unfavorable timing of packaway-related costs.

ROST in the third quarter of FY 22 has reported the adjusted earnings per share of $1, beating the analysts’ estimates for the adjusted earnings per share of 81 cents, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 35.9 percent to $4.57 billion in the third quarter of FY 22, beating the analysts’ estimates for revenue of $4.36 billion.

During the third quarter, the company had repurchased 2.8 million shares of common stock for an aggregate price of $244 million. The company remains on track to buy back a total of $950 million in common stock during fiscal 2022 under the two-year $1.9 billion repurchase program that extends through fiscal 2023. The company has declared a regular quarterly cash dividend of $0.31 per common share, payable on December 30, 2022 to stockholders of record as of December 6, 2022.

The company now expects fourth quarter same store sales to be flat to down 2% on top of a 9% gain in the prior year, with earnings per share forecasted to be in the range of $1.13 to $1.26. Based on the year-to-date results and the fourth quarter forecast, earnings per share for fiscal 2022 are now projected to be in the range of $4.21 to $4.34 versus $4.87 last year.

Meanwhile, the company had announced the recent opening of 28 Ross Dress for Less® (“Ross”) and 12 dd’s DISCOUNTS® stores across 21 different states in September and October. These new locations complete the Company’s store growth plans for fiscal 2022 with the addition of 99 new stores. Looking ahead, the company is confident in the expansion plans and continue to see plenty of opportunity to grow to at least 2,900 Ross Dress for Less and 700 dd’s DISCOUNTS locations over time.” Together, Ross Dress for Less and dd’s DISCOUNTS currently operate 2,019 off-price apparel and home fashion stores in 40 states, the District of Columbia, and Guam.

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