Ross Stores, Inc., the off-price clothing and home goods retailer, revised its annual profit forecast upward on Tuesday, citing a moderation in freight costs and a sustained demand for its products.
In a statement, CEO Barbara Rentler attributed the company’s robust performance to its ‘compelling value proposition’ and ‘successful execution of our strategic initiatives.’ Despite inflationary pressures, Ross Stores experienced healthy customer traffic and a favorable product mix across its store base.
The company now expects its diluted earnings per share for fiscal 2023 to range between $4.53 and $4.68, compared to its previous guidance of $4.38 to $4.53 per share. This represents an increase of approximately 3.5% to 6%.
Ross Stores also reported a Q3 comparable store sales increase of 7%, surpassing analysts’ estimates and indicating continued strength in its off-price segment.
The company’s shares reacted positively to the news, rising more than 5% in premarket trading. Investors welcomed the upbeat outlook as a sign of resilience and adaptability in the face of macroeconomic challenges.
Ross Stores’ favorable results underscore the ongoing resilience of the off-price retail sector, where consumers seek value and affordability amid rising costs. The company’s focus on differentiated merchandise and its ability to navigate supply chain disruptions have contributed to its success.
As Ross Stores moves forward, it remains cautious about the overall economic landscape and potential headwinds. However, the company’s strong brand recognition, loyal customer base, and effective cost management position it well to navigate these challenges and continue delivering solid financial performance..
