Ross Stores touts 'very strong start' for spring shopping, boosting case for a retail rebound

By Bill Peters

Off-price retailer's rosy outlook follows Target's call for sales to recover this year

Ross Stores' stock is up 42.6% over the past 12 months.

Shares of Ross Stores jumped in early Wednesday trading after the off-price clothing and home-goods chain said it expects sales gains this year, following what management said was a solid start to the spring shopping season.

The outlook came after higher prices continued to hit Ross Stores' (ROST) lower-income shoppers harder last year, and as U.S. tariffs sent tremors through the retail landscape. However, the backdrop has kept consumers overall focused on the bargains typically offered on Ross' shelves.

"We ended the fourth quarter with solid momentum, and while early, we are encouraged by the very strong start to the spring season," Ross CEO Jim Conroy said in a statement late Tuesday.

Shares rose 7.3% in premarket trading Wednesday, enough to make it the S&P 500 index's SPX best performer ahead of the open.

Ross Stores' stock has soared 45.4% over the past 12 months through Tuesday, amid the continued consumer flight to discounts, while the S&P 500 has advanced 18%.

Some analysts saw a path to a recovery for the retail industry this year, even as hostilities with Iran and President Donald Trump's policies raise fresh threats to the economy. Earlier in the day, Target (TGT) said it expects sales to rebound this year, as it tries to rediscover its sense of style and value.

After tariffs landed early last year, Conroy said business didn't get better for Ross until later in the year, culminating with a strong holiday season. Marketing, along with efforts to make the stores easier to shop, also helped, he said.

Ross said it expects first-quarter same-store sales to increase 7% to 8%, with earnings per share of $1.60 to $1.67 over that period. That forecast topped analysts' estimates.

For the full year, Ross sees same-store sales gains of 3% to 4%, with the midpoint of that range above Wall Street's estimates. Ross said it expects earnings of $7.02 to $7.36 a share. The midpoint of that forecast was below analysts' expectations.

Ross Stores' fourth-quarter results also beat estimates. The chain reported revenue up 12% year over year to $6.6 billion. Same-store sales rose 9%. The company earned $2 a share during the period.

-Bill Peters

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03-04-26 0632ET