What Can Ross Do To Cement its Recent Success Story?

Positioned squarely in the off-price retail segment, Ross delivered significant financial beats during its Q3 reporting, doing so well as to raise its fourth-quarter outlook based on the strong results.

Ross Stores reported earnings per share of $1.58 on income of $512 million for the 13 weeks concluding Nov. 1, including a $0.05 negative EPS impact attributed to tariffs. Those figures stack up pretty well against an EPS of $1.48 in the year-prior quarterly breakdown, as well as net income of $489 million during Q3 2024.

Overall quarterly sales trended upward by approximately 10%, to $5.6 billion from $5.1 billion a year ago, while comp store sales improved by a substantial 7%.

“We are pleased with our third quarter sales results, which accelerated from the prior quarter. Our merchandise assortment of compelling brand name values resonated with shoppers, and our new marketing campaign drove excitement and higher customer engagement. We had an excellent back-to-school season with strong trends that continued through the balance of the quarter,” said Jim Conroy, CEO.

“The strong execution by the entire team led to broad-based sales growth across merchandise areas and geographical regions. The strength in top-line, coupled with our continued focus on expense control, resulted in an operating margin of 11.6% that was much stronger than expected,” he added.

Analyst Opinion Suggests Ross Is Well-Positioned For Value-Seeking Core Customer Base

And according to Emarketer VP Suzy Davidkhanian, cited by Chain Store Age, it appears that Ross is seeing endurance in terms of spend coming from its core customer base – potentially a positive signal for what is on the horizon.

“Its core value shopper remained resilient despite lapsed SNAP benefits and broader tariff uncertainty weighing on household budgets,” Davidkhanian indicated.

That raised forecast coming from Ross shows comparable sales improving between 3% and 4%, with EPS estimated at between $1.77 and $1.85.

Further, Ross revised its fiscal 2025 earnings guidance upwards to range from between $6.38 to $6.46, with a $0.16 per share negative impact tied to tariffs also being factored in.