ROSS STORES INC (ROST) Stock Fundamental Analysis
NASDAQ:ROST - US7782961038 - Common Stock
147.25 USD
+1.63 (+1.12%)
147.94 USD
+0.69 (+0.47%)
We assign a fundamental rating of 6 out of 10 to ROST. ROST was compared to 124 industry peers in the Specialty Retail industry. ROST has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. ROST has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year ROST was profitable.
In the past year ROST had a positive cash flow from operations.
ROST had positive earnings in each of the past 5 years.
Each year in the past 5 years ROST had a positive operating cash flow.
1.2 Ratios
ROST has a better Return On Assets (14.55%) than 88.71% of its industry peers.
The Return On Equity of ROST (37.34%) is better than 88.71% of its industry peers.
With an excellent Return On Invested Capital value of 19.99%, ROST belongs to the best of the industry, outperforming 88.71% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for ROST is significantly above the industry average of 11.78%.
The last Return On Invested Capital (19.99%) for ROST is above the 3 year average (17.29%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.55% | ||
| ROE | 37.34% | ||
| ROIC | 19.99% |
ROA(3y)12.8%
ROA(5y)10.34%
ROE(3y)37.23%
ROE(5y)31.34%
ROIC(3y)17.29%
ROIC(5y)14.87%
1.3 Margins
ROST's Profit Margin of 9.79% is amongst the best of the industry. ROST outperforms 88.71% of its industry peers.
In the last couple of years the Profit Margin of ROST has remained more or less at the same level.
The Operating Margin of ROST (12.24%) is better than 87.90% of its industry peers.
In the last couple of years the Operating Margin of ROST has declined.
ROST has a worse Gross Margin (27.78%) than 67.74% of its industry peers.
ROST's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.24% | ||
| PM (TTM) | 9.79% | ||
| GM | 27.78% |
OM growth 3Y-0.26%
OM growth 5Y-1.77%
PM growth 3Y2.8%
PM growth 5Y-0.91%
GM growth 3Y0.3%
GM growth 5Y-0.21%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so ROST is creating value.
Compared to 1 year ago, ROST has less shares outstanding
Compared to 5 years ago, ROST has less shares outstanding
The debt/assets ratio for ROST has been reduced compared to a year ago.
2.2 Solvency
ROST has an Altman-Z score of 6.01. This indicates that ROST is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 6.01, ROST belongs to the best of the industry, outperforming 91.13% of the companies in the same industry.
The Debt to FCF ratio of ROST is 0.94, which is an excellent value as it means it would take ROST, only 0.94 years of fcf income to pay off all of its debts.
ROST has a Debt to FCF ratio of 0.94. This is in the better half of the industry: ROST outperforms 79.84% of its industry peers.
ROST has a Debt/Equity ratio of 0.18. This is a healthy value indicating a solid balance between debt and equity.
ROST's Debt to Equity ratio of 0.18 is fine compared to the rest of the industry. ROST outperforms 64.52% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.18 | ||
| Debt/FCF | 0.94 | ||
| Altman-Z | 6.01 |
ROIC/WACC2.16
WACC9.24%
2.3 Liquidity
ROST has a Current Ratio of 1.55. This is a normal value and indicates that ROST is financially healthy and should not expect problems in meeting its short term obligations.
ROST's Current ratio of 1.55 is fine compared to the rest of the industry. ROST outperforms 66.13% of its industry peers.
A Quick Ratio of 0.95 indicates that ROST may have some problems paying its short term obligations.
ROST has a better Quick ratio (0.95) than 75.81% of its industry peers.
The current and quick ratio evaluation for ROST is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.55 | ||
| Quick Ratio | 0.95 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 6.75% over the past year.
Measured over the past 5 years, ROST shows a small growth in Earnings Per Share. The EPS has been growing by 6.56% on average per year.
The Revenue has been growing slightly by 2.49% in the past year.
Measured over the past years, ROST shows a small growth in Revenue. The Revenue has been growing by 5.67% on average per year.
EPS 1Y (TTM)6.75%
EPS 3Y9.15%
EPS 5Y6.56%
EPS Q2Q%0.68%
Revenue 1Y (TTM)2.49%
Revenue growth 3Y3.76%
Revenue growth 5Y5.67%
Sales Q2Q%2.61%
3.2 Future
The Earnings Per Share is expected to grow by 8.54% on average over the next years. This is quite good.
ROST is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.87% yearly.
EPS Next Y-0.05%
EPS Next 2Y4.79%
EPS Next 3Y6.17%
EPS Next 5Y8.54%
Revenue Next Year3.96%
Revenue Next 2Y4.24%
Revenue Next 3Y4.59%
Revenue Next 5Y4.87%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
ROST is valuated rather expensively with a Price/Earnings ratio of 23.26.
Based on the Price/Earnings ratio, ROST is valued a bit cheaper than 69.35% of the companies in the same industry.
When comparing the Price/Earnings ratio of ROST to the average of the S&P500 Index (27.24), we can say ROST is valued inline with the index average.
ROST is valuated rather expensively with a Price/Forward Earnings ratio of 21.22.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ROST is on the same level as its industry peers.
ROST is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 35.82, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.26 | ||
| Fwd PE | 21.22 |
4.2 Price Multiples
ROST's Enterprise Value to EBITDA ratio is in line with the industry average.
62.90% of the companies in the same industry are more expensive than ROST, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 29.98 | ||
| EV/EBITDA | 15.02 |
4.3 Compensation for Growth
ROST has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)3.55
EPS Next 2Y4.79%
EPS Next 3Y6.17%
5. Dividend
5.1 Amount
ROST has a Yearly Dividend Yield of 1.11%.
ROST's Dividend Yield is a higher than the industry average which is at 5.69.
Compared to an average S&P500 Dividend Yield of 2.32, ROST's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.11% |
5.2 History
On average, the dividend of ROST grows each year by 7.61%, which is quite nice.
ROST has been paying a dividend for at least 10 years, so it has a reliable track record.
ROST has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)7.61%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
23.95% of the earnings are spent on dividend by ROST. This is a low number and sustainable payout ratio.
The dividend of ROST is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP23.95%
EPS Next 2Y4.79%
EPS Next 3Y6.17%
147.25
+1.63 (+1.12%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners95.81%
Inst Owner Change-1%
Ins Owners2.09%
Ins Owner Change4.73%
Market Cap48.16B
Analysts81.6
Price Target156.01 (5.95%)
Short Float %1.7%
Short Ratio1.8
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.11% |
Yearly Dividend1.47
Dividend Growth(5Y)7.61%
DP23.95%
Div Incr Years4
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3%
Min EPS beat(2)0%
Max EPS beat(2)5.99%
EPS beat(4)4
Avg EPS beat(4)3.51%
Min EPS beat(4)0%
Max EPS beat(4)5.99%
EPS beat(8)8
Avg EPS beat(8)5.81%
EPS beat(12)12
Avg EPS beat(12)6.78%
EPS beat(16)15
Avg EPS beat(16)9.48%
Revenue beat(2)0
Avg Revenue beat(2)-2.18%
Min Revenue beat(2)-2.68%
Max Revenue beat(2)-1.68%
Revenue beat(4)0
Avg Revenue beat(4)-2.24%
Min Revenue beat(4)-3.38%
Max Revenue beat(4)-1.22%
Revenue beat(8)2
Avg Revenue beat(8)-0.93%
Revenue beat(12)3
Avg Revenue beat(12)-0.89%
Revenue beat(16)5
Avg Revenue beat(16)-0.6%
PT rev (1m)0.82%
PT rev (3m)-1.97%
EPS NQ rev (1m)-0.52%
EPS NQ rev (3m)-6.89%
EPS NY rev (1m)-0.2%
EPS NY rev (3m)-3.52%
Revenue NQ rev (1m)-0.07%
Revenue NQ rev (3m)1.12%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)0.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.26 | ||
| Fwd PE | 21.22 | ||
| P/S | 2.27 | ||
| P/FCF | 29.98 | ||
| P/OCF | 20.09 | ||
| P/B | 8.64 | ||
| P/tB | 8.64 | ||
| EV/EBITDA | 15.02 |
EPS(TTM)6.33
EY4.3%
EPS(NY)6.94
Fwd EY4.71%
FCF(TTM)4.91
FCFY3.34%
OCF(TTM)7.33
OCFY4.98%
SpS64.99
BVpS17.05
TBVpS17.05
PEG (NY)N/A
PEG (5Y)3.55
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.55% | ||
| ROE | 37.34% | ||
| ROCE | 26.36% | ||
| ROIC | 19.99% | ||
| ROICexc | 32.41% | ||
| ROICexgc | 32.41% | ||
| OM | 12.24% | ||
| PM (TTM) | 9.79% | ||
| GM | 27.78% | ||
| FCFM | 7.56% |
ROA(3y)12.8%
ROA(5y)10.34%
ROE(3y)37.23%
ROE(5y)31.34%
ROIC(3y)17.29%
ROIC(5y)14.87%
ROICexc(3y)32.61%
ROICexc(5y)29.08%
ROICexgc(3y)32.61%
ROICexgc(5y)29.08%
ROCE(3y)22.8%
ROCE(5y)19.61%
ROICexcg growth 3Y-3.26%
ROICexcg growth 5Y2.96%
ROICexc growth 3Y-3.26%
ROICexc growth 5Y2.96%
OM growth 3Y-0.26%
OM growth 5Y-1.77%
PM growth 3Y2.8%
PM growth 5Y-0.91%
GM growth 3Y0.3%
GM growth 5Y-0.21%
F-Score9
Asset Turnover1.49
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.18 | ||
| Debt/FCF | 0.94 | ||
| Debt/EBITDA | 0.33 | ||
| Cap/Depr | 174.46% | ||
| Cap/Sales | 3.72% | ||
| Interest Coverage | 34.18 | ||
| Cash Conversion | 78.5% | ||
| Profit Quality | 77.16% | ||
| Current Ratio | 1.55 | ||
| Quick Ratio | 0.95 | ||
| Altman-Z | 6.01 |
F-Score9
WACC9.24%
ROIC/WACC2.16
Cap/Depr(3y)169.59%
Cap/Depr(5y)154.94%
Cap/Sales(3y)3.55%
Cap/Sales(5y)3.37%
Profit Quality(3y)80.07%
Profit Quality(5y)494.81%
High Growth Momentum
Growth
EPS 1Y (TTM)6.75%
EPS 3Y9.15%
EPS 5Y6.56%
EPS Q2Q%0.68%
EPS Next Y-0.05%
EPS Next 2Y4.79%
EPS Next 3Y6.17%
EPS Next 5Y8.54%
Revenue 1Y (TTM)2.49%
Revenue growth 3Y3.76%
Revenue growth 5Y5.67%
Sales Q2Q%2.61%
Revenue Next Year3.96%
Revenue Next 2Y4.24%
Revenue Next 3Y4.59%
Revenue Next 5Y4.87%
EBIT growth 1Y6.47%
EBIT growth 3Y3.49%
EBIT growth 5Y3.8%
EBIT Next Year19.78%
EBIT Next 3Y9.39%
EBIT Next 5Y10.03%
FCF growth 1Y-11.11%
FCF growth 3Y11.5%
FCF growth 5Y0.26%
OCF growth 1Y-4.81%
OCF growth 3Y10.67%
OCF growth 5Y1.65%