Ross Stores (NASDAQ:ROST) Stock Rated "Outperform" in New Coverage at Wolfe Research

Key Points

• Wolfe Research initiated coverage of Ross Stores with an “outperform” rating. The stock has a consensus “Moderate Buy” rating and an average target price of $264.61, supported by multiple recent upgrades and target increases.
• Ross Stores reported a strong quarterly performance, earning $2.66 per share versus the $1.95 consensus estimate and generating $6.26 billion in revenue, up 13.3% year over year.
• Institutional ownership remains high at 86.86%, with major investors including BlackRock, State Street and Wellington increasing or initiating positions; however, the CEO and another insider recently sold shares.

Analysts at Wolfe Research began coverage on shares of Ross Stores (NASDAQ:ROST - Get Free Report) in a research note issued on Wednesday, MarketBeat Ratings reports. The firm set an "outperform" rating on the apparel retailer's stock.

A number of other brokerages have also commented on ROST. Barclays boosted their price target on Ross Stores from $260.00 to $298.00 and gave the company an "overweight" rating in a report on Friday, August 21st. Zacks Research raised Ross Stores from a "hold" rating to a "strong-buy" rating in a research report on Tuesday, October 6th. JPMorgan Chase & Co. boosted their price target on Ross Stores from $262.00 to $272.00 and gave the stock an "overweight" rating in a research report on Friday, August 21st. Jefferies Financial Group upped their target price on shares of Ross Stores from $265.00 to $285.00 and gave the company a "buy" rating in a report on Friday, August 21st. Finally, Citigroup upped their price objective on Ross Stores from $270.00 to $290.00 and gave the company a "buy" rating in a research note on Friday, August 21st. Three analysts have rated the stock with a Strong Buy rating, fourteen have given a Buy rating and four have assigned a Hold rating to the stock. According to MarketBeat, the company has a consensus rating of "Moderate Buy" and a consensus target price of $264.61.

Ross Stores Stock Performance

ROST opened at $236.67 on Wednesday. The stock has a market cap of $75.60 billion, a PE ratio of 28.65, a P/E/G ratio of 1.97 and a beta of 0.83. The company has a current ratio of 1.61, a quick ratio of 0.98 and a debt-to-equity ratio of 0.12. Ross Stores has a 1 year low of $154.87 and a 1 year high of $257.00. The stock's 50 day simple moving average is $231.76 and its 200-day simple moving average is $230.05.

Ross Stores (NASDAQ:ROST - Get Free Report) last issued its quarterly earnings data on Thursday, August 20th. The apparel retailer reported $2.66 earnings per share for the quarter, topping the consensus estimate of $1.95 by $0.71. Ross Stores had a net margin of 10.85% and a return on equity of 39.29%. The firm had revenue of $6.26 billion for the quarter, compared to analysts' expectations of $6.16 billion. During the same period in the prior year, the firm earned $1.56 earnings per share. The company's quarterly revenue was up 13.3% compared to the same quarter last year. Sell-side analysts forecast that Ross Stores will post 8.15 EPS for the current year.

Insider Transactions at Ross Stores

In other news, CEO James Conroy sold 49,205 shares of the stock in a transaction on Monday, September 14th. The shares were sold at an average price of $229.48, for a total transaction of $11,291,563.40. Following the completion of the sale, the chief executive officer directly owned 134,349 shares in the company, valued at $30,830,408.52. This represents a 26.81% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available through the SEC website. Also, insider Stephen C. Brinkley sold 6,424 shares of the stock in a transaction that occurred on Monday, September 14th. The stock was sold at an average price of $229.66, for a total value of $1,475,335.84. Following the transaction, the insider owned 51,665 shares in the company, valued at $11,865,383.90. The trade was a 11.06% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Company insiders own 2.10% of the company's stock.

Institutional Inflows and Outflows

Several hedge funds have recently modified their holdings of the stock. BlackRock Inc. bought a new position in shares of Ross Stores during the 2nd quarter worth approximately $5,938,711,000. State Street Corp grew its position in Ross Stores by 5.3% during the second quarter. State Street Corp now owns 14,643,656 shares of the apparel retailer's stock valued at $3,116,902,000 after buying an additional 734,009 shares during the period. Bank of America Corp DE purchased a new stake in Ross Stores during the second quarter worth about $2,024,203,000. Primecap Management Co. CA bought a new stake in Ross Stores in the second quarter worth about $1,937,995,000. Finally, Wellington Management Group LLP increased its stake in shares of Ross Stores by 89.2% during the 2nd quarter. Wellington Management Group LLP now owns 6,615,682 shares of the apparel retailer's stock worth $1,408,148,000 after purchasing an additional 3,118,591 shares during the last quarter. Hedge funds and other institutional investors own 86.86% of the company's stock.

About Ross Stores

Ross Stores, Inc is an off-price apparel and home fashion retailer headquartered in Dublin, California. The company operates primarily through its Ross Dress for Less stores, which offer branded and designer apparel, accessories, footwear, and home merchandise at discounts to regular department and specialty store prices.

Ross Stores also operates dd's DISCOUNTS, a chain focused on value-oriented apparel, accessories, footwear, and home products. Both retail formats generally purchase merchandise opportunistically from manufacturers, department stores, and other suppliers, allowing the company to offer changing assortments and discounted prices.

Founded in 1950, Ross Stores serves customers across the United States through its store network and e-commerce presence.