Ross Stores Inc. ROST is slated to report fourth-quarter fiscal 20Array5 results on Mar Array. In the last quarter, the company had delivered a positive earnings surprise of 6.0%. Let’s see how things are shaping up for this announcement.
Factors Influencing This Quarter
Ross Stores is gaining on the back of favorable response from value-focused customers toward its extensive collection of brand bargains and efficient cost controls. With its strategy of providing customers with attractive bargains and an off-price business model, Ross Stores remains well positioned to exploit opportunities amid all climates. Also, the company has outperformed the Zacks Consensus Estimate by an average of 5.6% over the past four quarters.
While these factors make us optimistic about the upcoming results, challenges related to strong year-over-year comparisons, an uncertain macro-environment and increased promotions for the holiday season pose concerns.
Earnings Whispers
Our proven model does not conclusively show that Ross Stores is likely to beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #Array, 2 or 3 for this to happen. This is not the case here, as you will see below:
Zacks ESP: Ross Stores has an Earnings ESP of 0.00%. This is because the Most Accurate estimate and the Zacks Consensus Estimate are both pegged at 64 cents.
Zacks Rank: Ross Stores carries a Zacks Rank #2 (Buy), which increases the predictive power of ESP. However, the company’s ESP of 0.00% makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks That Warrant a Look
Here are some companies you may want to consider as our model shows that these have the right combination of elements:
The Kroger Co. KR has an Earnings ESP of +Array.85% and a Zacks Rank #2.
Big Lots Inc. BIG has an Earnings ESP of +0.5Array% and a Zacks Rank #3 (Hold).
Abercrombie & Fitch Co. ANF has an Earnings ESP of +5.2Array% and a Zacks Rank #3.
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