Ross Stores comparable sales rose 10%, lifted by inflation-driven traffic. Conroy says the price gap vs. mainstream retail holds even as rivals cut prices.
Alpha Score of 71 reflects strong overall profile with strong momentum, moderate value, moderate quality, strong sentiment.
Ross Stores sales jumped 13% year over year in the quarter ended Aug. 1, and comparable-store sales rose 10%. Customer traffic drove the gain, the company said in a Thursday release. CEO Jim Conroy told analysts the quarter brought in new and lapsed shoppers, while existing customers made more frequent trips and spent more.
Conroy said the newcomers span a broad range of income and age groups. "We really want to be there for a customer that is battling higher gas prices and all the other inflation pressures that they have in their life," he said on the Aug. 20 earnings call. Ross operates the off-price apparel chain Ross Dress for Less and the lower-priced dd's DISCOUNTS banner, a second tier for shoppers trading down further.
PYMNTS, writing Aug. 17 ahead of the other big retailers' reports, said Ross could post the strongest results of the group because consumer caution tends to push shoppers into off-price stores. "Once in our stores, both new and existing customers are responding to our compelling values and a broader selection of fashion and brands," Conroy said. The reported gains matched the preview.
The good-better-best mix also came up on the call. The good price point, Conroy said, is the company's bread and butter, and he called any move to elevate the assortment "a foolhardy strategy" while discount retailers are under pressure.
Ross carries an Alpha Score of 66, rated Moderate, on its ROST stock page. The stock market analysis hub covers the Consumer Discretionary group.
The pricing question came when an analyst asked how Ross keeps prices below mainstream retail at a time when national chains are lowering prices, some with the help of tariff refunds that cut their import costs. Conroy said Ross has "tried to maintain a little bit more stability" on price. "If we were to see something where we didn't have that price umbrella under mainstream retail, we would make a change," he said. "I think we are still safe where we are now."
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