The pandemic severely hurt business activity. Shelter-in-place policies left millions of Americans stuck at home in order to stem the spread of COVID-19. The lion's share of shopping occurred online. I was concerned about
Ross Stores: The Upside Could Be Priced In
Summary
- ROST's quarterly revenue fell 4% Y/Y. Government stimulus checks may have kept revenue from falling further.
- Margins faltered as COVID-related costs rose. I expect revenue and margins to stabilize as the economy reopens.
- ROST has $4.8 billion in cash and positive cash flow. Robust liquidity should sustain the company.
- ROST and broader financial markets are up by double digits Y/Y. Some of the upside could be priced in. I rate ROST a hold.
The Shock Exchange has a B.A. in economics and MBA from a top 10 business school. He has over 10 years of M&A / corporate finance experience. Currently head the New York Shock Exchange, financial literacy program based in Brooklyn, NY.His book, "Shock Exchange: How Inner-City Kids From Brooklyn Predicted the Great Recession and the Pain Ahead", predicted pain ahead for the U.S. economy and financial markets.In 2014 the law firm of Kirby, McInerney, LLP brought a class action lawsuit against Molycorp, Inc. for "materially misleading statements" in its financial statements. Kirby, McInerney used investigative journalism from the Shock Exchange to buttress its case. That's the discipline the Shock Exchange brings to every situation he covers for SA.
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