Earnings Preview: Ross Stores Reports Q2 Results August 16

Aug.10.12 | About: Ross Stores, (ROST)

Ross Stores Inc. (NASDAQ:ROST) is scheduled to report its Q2 2012 results on August 16, 2012, before the market opens. The street expects EPS and revenue of $0.81 and $2.32B, respectively.

In this article I will recap the historical results of the company, its latest EPS estimates vs. surprises, the latest news from ROST and the news from its closest competitors.

Ross Stores Inc. Revenue and Net Income History

Recent EPS Actuals vs. Estimates

The company has met analysts' estimates in the last four quarters. In the last quarter it reported $0.93 EPS, in-line with analyst estimates.

Ross Stores Inc. EPS Historical Results vs Estimates

The consensus EPS estimate is $0.81 based on 25 analysts' estimates, up from $0.64 a year ago. Revenue estimates are $2.32B, up from $2.09B a year ago. The median target price by analysts for the stock is $69.00.

Average recommendation: Overweight

Source: Marketwatch

Analyst Upgrades and Downgrades

  • On July 6, 2012, Avondale reiterated Mkt Outperform rating for the company.
  • On May 20, 2012, Canaccord Genuity downgraded the company from Buy to Hold.
  • On May 4, 2012, MKM Partners reiterated Buy rating for the company.
  • On May 4, 2012, FBR Capital reiterated Outperform rating for the company.
  • On April 9, 2012, FBR Capital reiterated Outperform rating for the company.
  • On March 28, 2012, William Blair initiated Outperform rating for the company.
  • On March 16, 2012, Barclays Capital reiterated Equal Weight rating for the company.
  • On March 12, 2012, Avondale reiterated Mkt Outperform rating for the company.

Latest News

  • On August 2, 2012, Ross Stores, Inc. announced that for second quarter of 2012, it expects earnings per share (NYSEARCA:EPS) to be $0.80-$0.81. According to I/B/E/S Estimates, analysts are expecting the Company to report EPS of $0.79 for second quarter of 2012.
  • On July 5, 2012, Ross Stores, Inc. announced that for second quarter of 2012, it expects earnings per share to be $0.77 to $0.78. According to I/B/E/S Estimates, analysts are expecting the Company to report EPS of $0.78 for second quarter of 2012.
  • On May 17, 2012, Ross Stores, Inc. announced that the Company's Board of Directors declared a regular quarterly cash dividend of $0.14 per common share, payable on June 29, 2012 to stockholders of record as of June 5, 2012.
  • On May 17, 2012, Ross Stores, Inc. announced that for the second quarter of 2012, it is now forecasting same store sales to increase 3% to 4% and earnings per share of $0.72 to $0.75. The Company is raising fiscal 2012 EPS guidance to $3.26 to $3.37, above initial guidance of $3.12 to $3.27. According to I/B/E/S Estimates, analysts were expecting the Company to report EPS of $0.76 for the second quarter of 2012; EPS of $3.38 for fiscal 2012.
  • On May 3, 2012, Ross Stores, Inc. announced that for the first quarter of 2012, it expects earnings per share to be $0.92 to $0.93, up from prior guidance of $0.89 to $0.91. According to I/B/E/S Estimates, analysts were expecting the Company to report EPS of $0.92 for the first quarter of 2012.
  • On April 5, 2012, Ross Stores, Inc. announced that it is raising earnings per share guidance for the first quarter 2012 to $.89 to $.91, up from prior forecast of $.82 to $.86.

Competitors

J.C. Penney Company (NYSE:JCP), Kohl's Corp. (NYSE:KSS), Macy's (NYSE:M), Target Corp. (NYSE:TGT), and The TJX Companies (NYSE:TJX) are peers for comparison for Ross Stores. The table below provides the key metrics for these companies and the industry.

Ross Stores Inc. key ratio comparison with direct competitors

The chart below compares the stock price changes as a percentage for the selected companies for the last one year period.

ROST Chart

ROST data by YCharts

Competitors' Latest Development

  • On August 9, 2012, Kohl's Corp announced that for third quarter of 2012, it expects earnings per share in the range of $0.83 to $0.89 per diluted share. The guidance is based on total sales growth of 1% to 3% and comparable store sales growth of flat to 2% and includes expected third quarter share repurchases of $300 million.
  • On August 8, 2012, Macy's Inc raised earnings guidance for fiscal 2012 to a range of $3.30 to $3.35 per diluted share, compared with previous guidance for earnings per diluted share of $3.25 to $3.30. Guidance for same-store sales in fiscal 2012 remains unchanged at an increase of approximately 3.7%. According to I/B/E/S Estimates, analysts were expecting the Company to report EPS of $3.36 for fiscal 2012.
  • On July 23, 2012, Reuters reported that J.C. Penney Co Inc raised $248 million by selling part of its stake in a Simon Property Group Inc unit.
  • On July 10, 2012, Reuters reported that J C Penney Company Inc announced another 350 job cuts at its Plano, Texas headquarters, completing a reorganization of its home office designed to help it bring costs in line with those of rivals.
  • On July 5, 2012, Macy's Inc reaffirmed fiscal 2012 guidance and expects same store sales to rise by approximately 3.7%, with earnings per diluted share in the range of $3.25 to $3.30. According to I/B/E/S Estimates, analysts were expecting the Company to report EPS of $3.37 for fiscal 2012.
  • On July 5, 2012, Target Corp. announced that combined with the outlook for July, the Company is on-track to deliver second quarter sales and adjusted earnings per share in line with the guidance provided at the time of first quarter earnings release.
  • On July 5, 2012, TJX Companies Inc raised second quarter of 2013 and fiscal 2013 guidance. The Company expects second quarter of 2013 earnings per share in the range of $0.52-$0.53 and EPS of $2.31-$2.39 for fiscal 2013.
  • On June 13, 2012, Target Corp. announced that its Board of Directors has declared a quarterly dividend of $0.36 per common share. The dividend is payable September 10, 2012 to shareholders of record at the close of business August 15, 2012.
  • On June 12, 2012, The Economic Times reported that Wal-Mart Stores, Inc. plans to snap ties with companies that supply products to its stores if they are involved in any kind of corrupt practices, making it the first retail company to undertake such a stringent initiative in India.
  • On June 11, 2012, Reuters reported that New York City's pension funds became the latest group to file a derivative lawsuit against Wal-Mart Stores Inc based on reported allegations of bribery in Mexico and a possible cover-up by Wal-Mart officials.
  • On May 31, 2012, Kohl's Corporation announced that it now expect second quarter 2012 comparable store sales to be modestly negative.
  • On May 31, 2012, TJX Companies Inc announced that with above-plan sales in May, it now expect second quarter 2013 earnings per share to be at the high end of previously estimated range of $0.47-$0.50.
  • On May 18, 2012, Macy's Inc announced that it declared a regular quarterly dividend of $0.20 per share on Macy's common stock, payable July 2, 2012, to shareholders of record at the close of business on June 15, 2012.
  • On May 17, 2012, Wal-Mart Stores Inc announced that for second quarter of 2013, it expects diluted earnings per share from continuing operations to range between $1.13 and $1.18. According to I/B/E/S Estimates, analysts are expecting the Company to report EPS of $1.16 for second quarter of 2013.
  • On May 16, 2012, Target Corp. announced that for the second quarter of 2012, it expects adjusted EPS of $1.04 to $1.14 and GAAP EPS of $0.94 to $1.04. For fiscal 2012, the Company has raised its guidance by 5 cents and now expects adjusted EPS of $4.60 to $4.80 and GAAP EPS of $4.10 to $4.30. According to I/B/E/S Estimates, analysts were expecting the Company to report EPS of $1.00 for the second quarter of 2012; EPS of $4.29 for fiscal 2012.
  • On May 15, 2012, J.C. Penney Company Inc reaffirmed fiscal 2012 earnings guidance and expects earnings per share of $2.16 per share which excludes non-cash qualified pension expense, restructuring charges and markdown reserves as the Company transition merchandise assortment.
  • On May 15, 2012, TJX Companies Inc announced that for the second quarter of 2013, it expects diluted earnings per share to be in the range of $0.47 to $0.50. For fiscal 2013, it is raising its guidance for diluted earnings per share to be in the range of $2.27 to $2.37. According to I/B/E/S Estimates, analysts are expecting the Company to report EPS of $0.51 for the second quarter of 2013.

Technical Overview


The stock has a market capitalization of $15.29B and is currently trading at $67.79 with a 52 week range of $33.50 - $70.04. The stock's year-to-date performance has been 43.32%. It is currently trading above 20-, 50- and 200-day SMAs.

Sources: Yahoo Finance, Google Finance, Marketwatch, Finviz, Reuters.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.