Ross Stores (ROST) shares rose early Friday after the discount retailer lifted its full-year outlook and reported better-than-expected fiscal first-quarter results.
The company now anticipates earnings to come in between $7.50 and $7.74 per share for fiscal 2026, Chief Executive Jim Conroy said in a statement late Thursday. The retailer previously projected the metric to be in a range of $7.02 to $7.36, while the current consensus on FactSet is for $7.68.
Same-store sales are pegged to grow by 6% to 7% for the ongoing fiscal year, according to Conroy, compared with prior projections for a gain of 3% to 4%. The Street is looking for an increase of 6.7%.
"As our efforts to improve topline growth continue, we remain focused on disciplined, consistent execution across the business," Conroy said. "Moving forward, we believe we are well positioned to capture additional market share and drive profitable growth over the long term."
The stock rose 5.3% in the most recent premarket activity.
Earlier in the week, off-price retailer TJX (TJX) raised its full-year outlook after posting stronger-than-expected fiscal first-quarter results. Target (TGT) also lifted its fiscal 2026 sales growth guidance, while retail giant Walmart (WMT) issued a downbeat fiscal second-quarter earnings outlook.
Ross Stores' EPS climbed to $2.02 for the three-month period ended May 2 from $1.47 the year before, topping the average analyst estimate of $1.73. Sales advanced 21% to $6.01 billion, ahead of the Street's view for $5.64 billion.
"Momentum was solid throughout the quarter, with broad-based strength across the business," according to Conroy. The CEO cited customer traffic as the "primary driver" of the robust sales trend, while high consumer spending related to tax refunds also benefited the retailer's results.
Comparable store sales jumped 17%, exceeding the market's forecast for growth of 9.4%, buoyed by an increase in the number of transactions, Chief Financial Officer William Sheehan said during an earnings call, according to a FactSet transcript.
"The quarter started strongly as we transitioned well from the holiday selling season into spring, supported by more balanced inventory levels that allowed us to drive strong demand in February where we have historically struggled," Conroy said on the call. "The strength continued with solid mid-teen comps for the balance of the quarter."
For the current quarter, Ross Stores expects EPS to be at $1.85 to $1.93 and sales to increase by 9% to 11% on an annual basis, Sheehan told analysts. The Street is looking for EPS of $1.92 and sales of $6.09 billion. Comparable store sales are anticipated to increase by 6% to 7%, compared with the current average analyst estimate on FactSet for growth of 7%.
