Track market-moving stories before they get noisy

The two biggest off-price retailers just reported the same 13 weeks of business, one day apart. The market treated them like different industries.

TJX (TJX -0.11%), the company behind TJ Maxx, Marshalls, and HomeGoods, reported Wednesday morning that its comparable sales -- sales at stores open long enough to compare with a year earlier -- grew 4% in its fiscal second quarter of 2027 (the period ended Aug. 1, 2026), above its own plan. The stock fell 4% that day and kept falling Thursday, leaving it within about 5% of its 52-week low.

Ross Stores (ROST +4.39%) reported its own quarter, covering the very same weeks, after Thursday's close. Comparable sales grew 10%. The stock jumped on Friday, closing up more than 4%.

What did the market see that the headline numbers miss? The answer sits in the two companies' second-half plans.

Image source: The Motley Fool.

Ross: the growth is broadeningRoss delivered the kind of quarter off-price investors have been waiting for. Total sales rose 13% year over year to $6.3 billion, and the 10% comparable sales gain was driven primarily by customer traffic (more people in stores, not just bigger baskets).

Even more encouraging, management said the growth drew on both new customers and higher engagement from existing ones. And the 10% gain came on top of just a 2% rise in the same quarter last year.

Additionally, net income climbed to $851 million from $508 million a year earlier, and earnings per share of $2.66 landed far above the company's own $1.85-to-$1.93 guidance. About $0.60 of that came from tariff refunds under the International Emergency Economic Powers Act (IEEPA), so the clean beat was smaller than it looks -- but it was still a beat, and the company raised its outlook on top of it.

That outlook is the part the market paid for. Ross now expects comparable sales to grow 6% to 7% in the third quarter and 4% to 5% in the fourth -- raised numbers, against tougher year-over-year comparisons. And the third-quarter range matches the comparable sales guidance Ross gave for the quarter it just beat by three points.

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TJX: bigger, steadier, slowingTJX's quarter was good by nearly every measure it guides on. Revenue rose 5% year over year to $15.2 billion, and earnings per share of $1.36, up 24%, came in well above plan.

Excluding a $0.14 net tariff-refund benefit, adjusted earnings per share still grew 11%.

Topping it all off, the company raised its full-year margin and earnings outlook, lifted its long-term store target to 7,500 locations, and returned $1.3 billion to shareholders in the quarter. And the stock fell anyway.

The problem was the composition.

Marmaxx, the U.S. division that includes TJ Maxx and Marshalls and generates most of TJX's sales, grew comparable sales just 1%, down from 3% a year ago. The strength came from everywhere else.

"While sales at Marmaxx were below our expectations, HomeGoods, TJX Canada, and TJX International all delivered terrific comp sales increases of 6% to 7%, which underscores the strength of our global diversified business," said CEO Ernie Herrman in the earnings release.

The second-half plan, I think, extends the slowdown. TJX expects third-quarter comparable sales growth of just 2% to 3% and full-year growth of 3% to 4%. That sales outlook was not raised. The earnings raise came from margin, and part of it from tariff refunds.

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The second half decided itPut the two plans side by side and the reactions stop looking strange. Ross just posted 10% comparable sales growth and told investors to expect 6% to 7% next quarter. TJX posted 4% and told investors to expect 2% to 3%, with its flagship division near flat.

The valuations sharpen the contrast.

TJX's market value sits near $155 billion, about twice Ross' $78 billion, and the stocks trade at similar valuations: TJX at about 26 times earnings, Ross at about 29 times earnings.

So investors are paying nearly the same price per dollar of profit for a company growing comparable sales at less than half the rate.

And forward price-to-earnings ratios, measured against each company's own raised full-year guidance, land in the same neighborhood.

Sure, TJX runs the bigger, more diversified business, and a turn at Marmaxx could change this comparison quickly. Herrman said the third quarter is off to a strong start overall, with improvement at Marmaxx, and he may prove the plan conservative. But off-price is a traffic business. Ross is still pulling more customers through its doors quarter after quarter, while growth at TJX's biggest U.S. banners has nearly stalled.

I think the market read the two reports correctly. The quarter was fine at both companies. The second half, by each management team's own numbers, belongs to Ross.

Raises Second Half and Fiscal 2026 Outlook

, /PRNewswire/ -- Ross Stores, Inc. (Nasdaq: ROST) today reported financial results for the 13‑week quarter ended August 1, 2026.

Highlights:

Total sales for the second quarter of fiscal 2026 increased 13% versus last year, with comparable store sales up a very strong 10%, primarily driven by customer traffic. Second quarter operating profits were $1.1 billion, which includes approximately $253 million from IEEPA tariff refunds. Operating margin increased 610 basis points, including 405 basis points from the tariff refunds. Excluding this benefit, operating margin increased by 205 basis points, well above the Company's plan for an increase of 130 to 150 basis points. Earnings per share for the second quarter were $2.66, which includes an approximate $0.60 per share benefit from the tariff refunds, well above our guidance of $1.85 to $1.93.   Opened 47 new stores during the quarter, including 35 Ross and 12 dd's DISCOUNTS. Increasing 2026 store opening plans to 115 new locations. Jim Conroy, Chief Executive Officer, commented, "We achieved stellar sales and earnings growth in the second quarter. I am incredibly proud of our teams across the Company, whose dedication and strong execution drove these outstanding results. Our performance was fueled by our compelling merchandise offerings, engaging marketing initiatives, and continued enhancements to the in-store experience. We were pleased to see strength throughout the quarter, with comparable store sales growth once again primarily driven by customer traffic. Importantly, that growth was supported by both an increase in new customers and higher engagement from existing customers. These trends reinforce our belief that the actions we are taking are not only driving the current business performance but that we can continue to build on our early successes."

Second Quarter and First Six Months Results

Sales for the second quarter increased 13% to $6.3 billion, up from $5.5 billion in 2025. Comparable store sales rose a very strong 10% for the quarter on top of a 2% gain last year. Net income was $851 million versus $508 million last year, while earnings per share were $2.66 compared to $1.56 per share in the prior year period.

For the first six months of fiscal 2026, sales increased a robust 17% to $12.3 billion, up from $10.5 billion in 2025. Comparable store sales for the six-month period were up 13%. Net income was $1.5 billion versus $987 million last year, while earnings per share were $4.69 compared to $3.03 per share in the prior year period.

Both the second quarter and first six months 2026 results include about $253 million in IEEPA tariff refunds, benefiting earnings per share by approximately $0.60.

Update on Shareholder Payouts

During the 2026 second quarter, a total of 1.4 million shares of common stock were repurchased for an aggregate price of $319 million under the Company's two-year $2.55 billion authorization approved by its Board of Directors in March 2026. The Company remains on track to buy back a total of $1.275 billion in common stock during fiscal 2026.

Fiscal 2026 Guidance

Mr. Conroy commented, "Looking ahead, we exited the second quarter with building momentum and are excited for the plans we have in place entering the Fall season. Despite facing significantly more challenging year-over-year comparisons in the back half, we are raising our outlook for both the third and fourth quarters. Comparable store sales are now expected to increase 6% to 7% in the third quarter and 4% to 5% in the fourth quarter. If the second half of 2026 performs in line with these sales projections, our earnings per share ranges for the third and fourth quarters are projected to be $1.75 to $1.83 and $2.17 to $2.26, respectively."

Mr. Conroy continued, "Based on our strong first half results and our updated second half guidance, we are increasing our 2026 fiscal year earnings per share projections to be in the range of $8.61 to $8.77, which again includes an approximate $0.60 earnings per share benefit from IEEPA tariff refunds recognized in the second quarter. From a store growth perspective, we continue to be encouraged by the success of our expansion strategy across both new and existing markets. As a result, we are increasing our 2026 new store opening plan to 115 locations, consisting of approximately 90 Ross Dress for Less and 25 dd's DISCOUNTS stores."

Mr. Conroy concluded, "The year is off to a very strong start with the entire organization executing at a high level. As our efforts to improve topline growth continue, we remain focused on disciplined, consistent execution across the business. Moving forward, we believe we are well positioned to capture additional market share and drive profitable growth over the long term."

The Company will host a conference call on Thursday, August 20, 2026 at 4:15 p.m. Eastern time to provide additional details concerning its second quarter results and management's outlook for the second half and fiscal year 2026. A real-time audio webcast of the conference call will be available in the Investors section of the Company's website, located at www.rossstores.com. An audio playback will be available at 201-612-7415, PIN #13762049 until 8:00 p.m. Eastern time on August 27, 2026, as well as on the Company's website.

Forward-Looking Statements:  This press release and the related conference call remarks contain forward-looking statements regarding, without limitation, projected sales, costs and earnings, planned new store growth, capital expenditures, liquidity and other matters. These forward-looking statements reflect our then-current beliefs, plans, and estimates with respect to future events and our projected financial performance, operations, and competitive position, and they are subject to risks and uncertainties which could cause our actual results to differ materially from management's current expectations. The words "plan," "expect," "target," "anticipate," "estimate," "believe," "forecast," "projected," "guidance," "outlook," "looking ahead," and similar expressions identify forward-looking statements. Risk factors for Ross Dress for Less® ("Ross") and dd's DISCOUNTS® include without limitation, risk from adverse changes in the macroeconomic environment, government regulations and policies, geopolitical conditions and conflicts, and financial and credit markets; increased costs of fuel and other consumer necessities, continuing inflation and other external economic trends and events may have significant negative effects on consumer confidence, shopping behavior, and spending, and also on our costs; tariff increases (or threats of increases) and other changes and uncertainty in U.S. trade or tax policy regarding apparel, home-related merchandise, shoes, and other goods we sell that are produced in other countries; competitive pressures and the pace of change in the retailing industry; unexpected changes in the level of consumer spending or preferences; adverse or unseasonable weather may affect shopping patterns and consumer demand for seasonal apparel and other merchandise, and may result in temporary store closures and disruptions in deliveries of merchandise to our stores; our dependence on the market availability, quantity, and quality of attractive brand name merchandise at desirable discounts, and on the ability of our buyers to source and purchase merchandise to enable us to offer customers a wide assortment of merchandise at competitive prices; our need to expand in existing markets and enter new geographic markets in order to achieve growth; our need to obtain acceptable new store sites with favorable consumer demographics in order to achieve growth; our need to continually attract, train, and retain associates with the retail talent necessary to execute our off-price retail strategies, as well as labor shortages, increased turnover, or increased labor costs; our need to effectively manage our inventories, markdowns, and inventory shortage in order to achieve our planned gross margins; information or data security breaches, including cyberattacks on our transaction processing and computer information systems, including malware intrusion, data exfiltration, identity theft, and other types of cybersecurity threats, could disrupt our operations, result in theft or unauthorized disclosure of our confidential and valuable business information or credit card and other customer information, and could disrupt our operations, damage our reputation, increase our costs, and create significant legal exposure; disruptions in our supply chain or in our information systems could impact our ability to process sales and to deliver product to our stores in a timely and cost-effective manner; risks associated with importing and selling merchandise produced in other countries; damage to our corporate reputation or brands; a natural or man-made disaster in a region where we have a concentration of stores, offices, or a distribution center; consumer problems or legal issues involving the quality, safety, or authenticity of products we sell could harm our reputation, result in lost sales, and/or increase our costs; an adverse outcome in various legal, regulatory, or tax matters, could damage our reputation or brand and increase our costs. Other risk factors are set forth in our SEC filings including the Form 10-K for fiscal 2025 and fiscal 2026 Form 8-Ks and 10-Q on file with the SEC. The factors underlying our forecasts and plans are dynamic and subject to change. As a result, any forecasts or forward-looking statements speak only as of the date they are given and do not necessarily reflect our outlook at any other point in time. We disclaim any obligation to update or revise these forward-looking statements.

About Ross Stores, Inc.

Ross Stores, Inc. is an S&P 500, Fortune 500, and Nasdaq 100 (ROST) company headquartered in Dublin, California, with fiscal 2025 revenues of $22.8 billion. Currently, the Company operates Ross Dress for Less® ("Ross"), the largest off-price apparel and home fashion chain in the United States with 1,952 locations in 44 states, the District of Columbia, Guam, and Puerto Rico. Ross offers first-quality, in-season, brand name and designer apparel, accessories, footwear, and home fashions for the entire family at savings of 20% to 60% off department and specialty store regular prices every day. The Company also operates 376 dd's DISCOUNTS® stores in 23 states that feature a more moderately-priced assortment of first-quality, in-season apparel, accessories, footwear, and home fashions for the entire family at savings of 20% to 70% off moderate department and discount store regular prices every day. Additional information is available at www.rossstores.com.

Ross Stores, Inc.

Condensed Consolidated Statements of Earnings

Three Months Ended

Six Months Ended

($000, except stores and per share data, unaudited)

August 1, 2026

August 2, 2025

August 1, 2026

August 2, 2025

Sales

$             6,264,886

$             5,529,152

$           12,275,362

$           10,514,123

Costs and Expenses

Cost of goods sold

4,145,215

4,002,167

8,375,804

7,583,533

Selling, general and administrative

1,016,053

888,711

1,991,914

1,685,846

Operating income

1,103,618

638,274

1,907,644

1,244,744

Interest income, net

(31,144)

(32,346)

(64,593)

(66,755)

Earnings before taxes

1,134,762

670,620

1,972,237

1,311,499

Provision for taxes on earnings

283,463

162,625

470,974

324,255

Net earnings

$                851,299

$                507,995

$             1,501,263

$                987,244

Earnings per share

Basic

$                     2.68

$                     1.57

$                     4.72

$                     3.05

Diluted

$                     2.66

$                     1.56

$                     4.69

$                     3.03

Weighted-average shares outstanding (000)

Basic

317,687

323,000

318,322

323,938

Diluted

319,450

324,796

320,343

325,909

Store count at end of period

2,328

2,233

2,328

2,233

Ross Stores, Inc.

Condensed Consolidated Balance Sheets

($000, unaudited)

August 1, 2026

August 2, 2025

Assets

Current Assets

Cash and cash equivalents

$                 4,288,124

$                 3,847,016

Accounts receivable

248,140

210,520

Merchandise inventory

3,087,370

2,608,485

Prepaid expenses and other

252,726

259,815

Total current assets

7,876,360

6,925,836

Property and equipment, net

4,257,806

3,906,340

Operating lease assets

3,545,351

3,374,582

Other long-term assets

302,763

288,761

Total assets

$               15,982,280

$               14,495,519

Liabilities and Stockholders' Equity

Current Liabilities

Accounts payable    

$                 2,621,740

$                 2,205,613

Accrued expenses and other

744,284

655,218

Current operating lease liabilities

752,302

716,162

Accrued payroll and benefits

440,837

315,893

Income taxes payable

84,916

—

Current portion of long-term debt

241,459

499,122

Total current liabilities

4,885,538

4,392,008

Long-term debt

777,053

1,017,218

Non-current operating lease liabilities

2,968,337

2,835,481

Other long-term liabilities

295,611

279,258

Deferred income taxes

312,557

238,985

Commitments and contingencies

Stockholders' Equity

6,743,184

5,732,569

Total liabilities and stockholders' equity

$               15,982,280

$               14,495,519

Ross Stores, Inc.

Condensed Consolidated Statements of Cash Flows

Six Months Ended

($000, unaudited)

August 1, 2026

August 2, 2025

Cash Flows From Operating Activities

Net earnings

$               1,501,263

$                  987,244

Adjustments to reconcile net earnings to net cash provided by operating activities:

Depreciation and amortization

272,790

242,337

Stock-based compensation

106,377

83,239

Deferred income taxes

51,130

51,945

Change in assets and liabilities:

Merchandise inventory

(456,400)

(163,972)

Other current assets

(85,729)

(92,049)

Accounts payable

226,307

101,937

Other current liabilities 

65,676

(83,135)

Income taxes

29,788

(54,139)

Operating lease assets and liabilities, net

166

4,301

Other long-term, net 

399

369

Net cash provided by operating activities

1,711,767

1,078,077

Cash Flows From Investing Activities

Additions to property and equipment

(460,217)

(409,105)

Net cash used in investing activities

(460,217)

(409,105)

Cash Flows From Financing Activities

Issuance of common stock related to stock plans

13,183

12,380

Treasury stock purchased

(136,595)

(64,420)

Repurchase of common stock

(637,500)

(525,021)

Excise tax paid on repurchase of common stock

(9,496)

(9,443)

Dividends paid

(286,191)

(265,637)

Payment of long-term debt

(500,000)

(700,000)

Net cash used in financing activities

(1,556,599)

(1,552,141)

Net decrease in cash, cash equivalents, and restricted cash and cash equivalents

(305,049)

(883,169)

Cash, cash equivalents, and restricted cash and cash equivalents:

Beginning of period

4,661,973

4,796,462

End of period

$               4,356,924

$               3,913,293

Reconciliations:

Cash and cash equivalents

$               4,288,124

$               3,847,016

Restricted cash and cash equivalents included in prepaid expenses and other

21,328

17,232

Restricted cash and cash equivalents included in other long-term assets

47,472

49,045

Total cash, cash equivalents, and restricted cash and cash equivalents:

$               4,356,924

$               3,913,293

Supplemental Cash Flow Disclosures

Interest paid

$                    19,839

$                    35,939

Income taxes paid, net

$                  390,056

$                  326,449

Contacts:         William W. Sheehan II                     

Connie Kao

                          Executive Vice President,                

Senior Vice President, Investor Relations

                          Chief Financial Officer                      

(925) 965-4668

                          (925) 965-4150                                

[email protected] 

SOURCE Ross Stores, Inc.

Key Takeaways Ross Stores is expected to benefit from broad-based demand, store growth and merchandise execution.Ross Stores targets 6-7% comps and 12.8-13% operating margin, with merchandise margin supporting results.Tariffs, inflation and trade-policy changes could pressure costs and limit earnings despite strong demand. Ross Stores, Inc. (ROST - Free Report) is likely to post year-over-year top and bottom-line growth when it reports second-quarter fiscal 2026 earnings on Aug. 20, after market close. The Zacks Consensus Estimate for quarterly revenues is pegged at $6.1 billion, indicating a rise of 10.7% from the year-ago quarter’s figure.

The consensus estimate for earnings is pegged at $1.92 per share, up 23.1% from the year-earlier period. The consensus mark has risen a penny in the past seven days.

ROST has a trailing four-quarter earnings surprise of 10.2%, on average. In the last reported quarter, the company posted an earnings surprise of 18.8%.

Key Factors Likely to Influence ROST’s Q2 ResultsRoss Stores’ second-quarter fiscal 2026 performance is expected to have been supported by broad-based strength across its merchandise categories, fueled by solid customer response at the banners. Its ability to consistently deliver value-driven bargains continues to resonate with price-conscious consumers amid a cautious discretionary spending backdrop. Consistent execution of store expansion plans is also expected to have supported top-line growth.

Ross Stores is focused on strengthening its off-price business by offering customers compelling value, expanding its store network and improving merchandise execution. The company is working to broaden its merchandise assortments, offer more recognizable brands and improve the speed and timing of product flow. Backed by its proven business model, Ross Stores is poised to have generated increased traffic, stronger same-store sales and improved profitability for the quarter under review.

On the last reported quarter’s earnings call, the company had forecast comparable-store sales (comps) to increase 6-7% and earnings per share of $1.85-$1.93, with operating margin guided to 12.8-13% for second-quarter fiscal 2026. Second-quarter fiscal 2026 guidance assumes merchandise margin improvement and lower distribution costs as the company celebrates the opening of a new Arizona distribution center. Our model anticipates operating margin to rise 12.8% and earnings per share of $1.86 for the second quarter.

However, Ross Stores remains cautious about ongoing macroeconomic and geopolitical uncertainties, persistent inflation and their impact on consumer spending. The company also continues to face tariff-related headwinds, as evolving trade policies and elevated duties put pressure on its cost structure. Changes in ticketing, processing and import costs driven by tariffs are likely to have increased volatility in cost of goods sold and limited earnings.

What the Zacks Model UnveilsOur proven model predicts an earnings beat for Ross Stores this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Ross Stores currently has an Earnings ESP of +4.03% and a Zacks Rank of 3.

ROST’s Price Performance & Valuation PictureFrom a valuation perspective, Ross Stores has a forward 12-month price-to-earnings of 30.48X, slightly lower than the Retail-Discount Stores industry’s average of 31.13X. The stock is also trading slightly below its high level of 31.38X.

Image Source: Zacks Investment Research

The recent market movements show that ROST’s shares have gained 26.8% in the past six months compared with the industry's 0.5% growth.

More Stocks With the Favorable CombinationHere are three more companies, which according to our model, have the right combination of elements to post an earnings beat this season:

The TJX Companies (TJX - Free Report) currently has an Earnings ESP of +1.31% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

The company is likely to register growth in the bottom and top lines when it reports second-quarter fiscal 2026 results. The consensus mark for TJX’s quarterly revenues is pegged at $15.1 billion, which indicates a 5.1% rise from the figure reported in the prior-year quarter.

The consensus mark for TJX’s quarterly earnings has moved up a penny in the past 30 days to $1.18 per share. The consensus estimate indicates growth of 7.3% from the year-ago quarter’s actual. TJX has a trailing four-quarter earnings surprise of 8.8%, on average.

Williams-Sonoma, Inc. (WSM - Free Report) has an Earnings ESP of +3.05% and a Zacks Rank of 3. WSM is likely to register a top and bottom-line increase when it reports second-quarter fiscal 2026 numbers.

The Zacks Consensus Estimate for quarterly earnings per share of $2.05 suggests an increase of 2.5% from the year-ago fiscal quarter’s reported number. The consensus estimate for quarterly revenues is pegged at $1.9 billion, suggesting growth of 4.1% from the prior-year fiscal quarter’s reported figure. WSM has a trailing four-quarter earnings surprise of 7.2%, on average.

Designer Brands Inc. (DBI - Free Report) currently has an Earnings ESP of +0.03% and a Zacks Rank of 3. The company is expected to register a top-line increase when it reports second-quarter fiscal 2026 results.

The consensus mark for revenues is pegged at $743 million, indicating a rise of 0.4% from the figure reported in the year-ago quarter. The Zacks Consensus Estimate for quarterly earnings per share of 25 cents suggests a drop of 26.5% from the year-ago quarter. DBI has a trailing four-quarter earnings surprise of 112.8%, on average.

Key Takeaways ROST shares rose 79.6% in the past year, outperforming the S&P 500 and discount-store industry.Ross Stores is gaining from traffic growth, customer acquisition and stronger branded assortments.ROST raised FY26 guidance, with comparable sales growth of 6-7% and EPS of $7.50-$7.74. Ross Stores, Inc. (ROST - Free Report) has emerged as one of the strongest performers within its industry over the past year. Shares of ROST have surged 79.6% in the past year, significantly outperforming the broader market and most industry peers. Over the same period, the S&P 500 advanced 24.4%, the Retail - Discount Stores industry gained 14.1% and the broader Retail-Wholesale sector rose 2.9%.

ROST Stock’s Past Year Performance
Image Source: Zacks Investment Research

As of the latest trading session, Ross Stores closed at $228.6, just 5.9% below its 52-week high of $242.81 reached on June 12, 2026. The stock is trading above both its 50- and 200-day moving averages, signaling bullish sentiment.

ROST Trades Above 50 and 200-Day Moving Average
Image Source: Zacks Investment Research

What’s Fueling Ross Stores’ Rally?Ross Stores continues to gain from strong customer acquisition and traffic growth, which have been key drivers of its comparable-store sales performance. Transaction growth has accelerated for three straight quarters, supported by double-digit customer count gains across income groups, age demographics and ethnicities. Younger shoppers, in particular, are responding well to refreshed marketing efforts, improved store presentation and compelling branded assortments.

The company’s merchandising strength is another major catalyst. Ross Stores is benefiting from healthy closeout availability in the marketplace, deeper vendor relationships and improved access to branded deals. Its ability to quickly secure seasonally relevant merchandise has helped the company chase demand effectively while maintaining its value proposition.

Operational execution also remains solid. Ross Stores delivered merchandise margin gains and operating margin expansion in the first quarter, aided by occupancy leverage and lower distribution costs. The company’s disciplined cost structure, combined with strong sales productivity, continues to support earnings growth even as it invests in stores, marketing and customer experience.

Store expansion adds another layer of growth. Ross Stores plans to open about 110 stores this year, including Ross and dd’s DISCOUNTS locations, while recent openings are performing well across new and existing markets. Continued expansion in underpenetrated regions, including the Northeast, should help broaden the company’s customer reach and reinforce its long-term growth runway.

Upward Earnings Estimate Revisions Signal Confidence in ROSTRoss Stores remains optimistic about its growth prospects, backed by solid sales momentum and improving execution. Management expects second-quarter comparable sales growth of 6-7% and raised its full-year fiscal 2026 outlook, projecting comparable sales growth of 6-7% and earnings per share of $7.50-$7.74.

While acknowledging potential macroeconomic uncertainties, including higher fuel costs and consumer spending pressures, the company believes its value-focused business model, strong customer acquisition trends, merchandising initiatives and expanding store base position it well to sustain healthy sales and earnings growth over the remainder of the year.

Reflecting optimism around ROST, analysts have revised their EPS estimates upward. In the past 30 days, analysts have increased their fiscal 2026 and 2027 estimates by 1.3% to $7.74 and 1.3% to $8.48 per share, respectively. These estimates indicate expected year-over-year growth rates of around 17.1% and 9.6%, respectively.

Image Source: Zacks Investment Research

ROST Stock’s ValuationRoss Stores is currently trading at a discount relative to its industry peers. ROST stock trades at a forward 12-month price-to-earnings (P/E) ratio of 28.47, lower than the industry’s average of 31.39.

Image Source: Zacks Investment Research

Here’s Why ROST Can Be an Attractive PlayRoss Stores continues to execute well across key growth drivers, including customer acquisition, merchandising, operational efficiency and store expansion. Strong comparable sales, margin expansion and raised earnings guidance reflect the strength of its value-focused business model, while positive estimate revisions underscore growing analyst confidence.

Although macroeconomic uncertainties such as higher fuel costs and consumer spending pressures remain, ROST's resilient off-price model and attractive valuation relative to the industry support a favorable long-term investment case. Currently, this Zacks Rank #1 (Strong Buy) stock appears well positioned for investors seeking exposure to the renewable fuels market and long-term growth opportunities.

Other Stocks to ConsiderFive Below, Inc. (FIVE - Free Report) , which operates as a specialty value retailer, currently flaunts a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Five Below’s current fiscal-year sales and earnings suggests growth of 14.7% and 34.3%, respectively, from the year-ago figures. FIVE delivered a trailing four-quarter earnings surprise of 70.1%, on average.

Tapestry, Inc. (TPR - Free Report) provides accessories and lifestyle brand products in North America, Greater China, the rest of Asia and internationally. At present, TPR sports a Zacks Rank of 1.

The Zacks Consensus Estimate for current fiscal-year sales and earnings implies growth of 13.8% and 36.3%, respectively, from the year-ago reported figures. TPR has delivered a trailing four-quarter earnings surprise of 15.6%, on average.

Victoria’s Secret & Co. (VSXY - Free Report) operates as a specialty retailer of women's intimate apparel and other apparel and beauty products worldwide. At present, VSXY flaunts a Zacks Rank of 1.

The Zacks Consensus Estimate for current fiscal-year sales and earnings implies growth of 8.8% and 53.7%, respectively, from the year-ago figures. VSXY delivered a trailing four-quarter earnings surprise of 55.1%, on average.