Ross Stores, Inc. (NASDAQ:ROST)

For reference point and to allow for comments by others. As of the end of March, 2013.

ROE 46.63%%
Trailing PE 17.54
PB 7.43
Div yield 1.10%

As of May 4

Buying on the recent pullback. Low leverage. Safe dividend (probably growing, given the size of the cash balance). So much more room for growth in revenues (high y/o/y EBIT growth and OCF, relative to peers).

I shop there and like the prices.

Nasdaq in maximums.

idk place looks like a ghost town to me seems to suck and the insider just sold 12 mill. looks like bad entry for red though. i may eat this

I still like off-price brick and mortar retailers. Call it the bored house-wife affect, or rainy-day affect, but people still like to browse and shop for bargains in retail stores (as opposed to internet shopping). Companies like ROST and TJX are still doing well and are poised for growth.

One day after a Citi downgrade, ROST announces YoY same store sales growth of 6.6% for the month of December. I think retail in general has been unfairly penalized by the tepid sales growth reported by MasterCard (an estimate that includes the week of Hurricane Sandy). Compelling, long-term growth stories such as Ross Stores have not been undermined by this data point.

Ross Stores on the surface appears to me as a more efficient operator compared to TJX. It has fewer stores, meaning better opportunity for expansion. Higher operating income per store is another plus. TJX in my opinion with its scale should have been getting better operating profit, but that's not the case. PE is lower too than TJX.
Debt at TJX is high at around 775MM. ROST has debt of 150MM. However, that is not important, because both stores have sufficient cash to pay off the debt and yet have some left. They both have similar dividend yields, high ROE and ROIC. I am satisfied with their FCF to Net Income ratios. They care comparable on EV/Sales ratio basis, however, since ROST has slightly better operating margin, I favor ROST here too.

I bought ROST back in the summer when it traded at 15x estimates with a share price of $60, I exited the trade when it got near it's average of 18x estimates or $67 per share. We are near 15x again, only this time I believe the situation is a better value due to the fact that the stock has been hammered recently despite excellent same store comps. I believe the price action has been caused by profit taking in light of fiscal cliff (capital gains) worries. We are coming into the holiday season and there are more bargain hunters in the current economy, which will help ROST greatly. I'm in ROST as a trade with an exit in the $67-$69 range.

ROST is a proven market leader with excellent fundamentals. It is currently beaten down due to a long run up which is now subject to profit taking. At this writing it is at $55.95 and expect it rise to and through $60 in 2013.

Outperform pick for 2013.

Nice steady growth retail stock.

Be fearful when others are greedy. The shares have overrun their valuation. However I do believe in their long run prospects

People are going to flock to discount retailers in today's society. And in turn, the retailer will continue to rise in value.

There is a lot of room for growth with this retailer

Growing, improving margins, great history of raising dividends. If I hadn't already added to my real money position late year, I would at to it now.

A good store with a plan for growth, and room to grow.

Fortune 500 top-ten performing stock from 2011.

Good store concept that works in tough times.