Ross Stores (ROST) delivered a "very solid" Q2, backing expectations that it can outgrow Department Store peers over the next few years, UBS said in a report Friday.
The retailer pointed to improved store execution, including better inventory recovery, stronger organization, and faster checkout times to its outperformance, the note said.
"These factors cause us to have improved confidence ROST can sustain solid comp momentum in 2H26," the note said.
The report said ROST is forecast to grow at around 8% over a 5-year EPS compounded annual growth rate, justifying a price-earnings ratio of about 27 times.
UBS raised its price target to $239 from $232 while keeping its neutral rating, expecting a balanced upside/downside skew.
Price: $238.55, Change: $+9.55, Percent Change: +4.17%