Ross Stores Inc (NASDAQ:ROST) stock rose 0.087% (As on July 3, 11:09:09 AM UTC-4, Source: Google Finance) after Jefferies upgraded the company to Buy from Hold with a price target of $150, up from $135. This is roughly 13% upside, and said Ross’s stock trades at about 19 times forward earnings, a six‑point discount to long‑time leader TJX Companies Inc and wider than its usual one‑point gap. Ross Stores is well-positioned to outperform as comps should accelerate through the end of the year, and EBIT should expand by 170 basis points over the next three years, the firm tells investors in a research note. Analyst wrote that same‑store sales could accelerate in the second half on “easy compares” and stronger women’s apparel and cosmetics ranges.

Jefferies forecasts third‑quarter comps of 3.3% versus Wall Street’s 2.5 % and sees 3.5% growth in the fourth quarter, then settling only slightly below the chain’s long‑term average of 3.8%. Brokerage expects operating margin to expand about 170 basis points by fiscal 2027 as buying and occupancy costs leverage on mid‑single‑digit sales growth and last year’s investments in branded merchandise bear fruit. Jefferies models EBIT margins at 11.5% in 2025, 12.4% in 2026 and 13.5% in 2027, approaching the pre‑pandemic norm even with an estimated 25–30 bp drag from new distribution projects and tariff costs. Ross’s new chief executive, Michael Hartshorn, has been in the job only six months, leaving “more of the playbook still to be revealed,” Jefferies said.

Moreover, about a quarter of revenue comes from home goods, giving the chain optionality if lower mortgage rates revive housing turnover. Short interest stands roughly 10 basis points above the five‑year average, Jefferies added, but low investor expectations, consensus still assumes a year‑on‑year earnings dip, give the Dallas‑area retailer room to surprise as it narrows the valuation gap with larger peer TJX.

Meanwhile, ROST has entered into a new senior unsecured revolving credit agreement, providing up to $1.3 billion in borrowing capacity. The new facility, effective June 27, 2025, replaces the company’s previous $1.3 billion revolving credit agreement from February 2022. The 2025 credit facility is set to expire in June 2030, with an option for Ross Stores to extend the term for up to two additional one-year periods, subject to lender approval and customary conditions. The agreement includes a $300 million sublimit for standby letters of credit and an option to increase the facility by as much as $700 million, contingent on lender commitment.