Ross Stores Inc. (ROST - Analyst Report) , one of the largest off-price apparel and home fashion chain retailers in the U.S., came up with stronger-than-expected sales and same-store sales numbers for the four weeks ended August 25, 2012.
Driven by strong consumer demand for the company’s wide array of brands during the back-to-school sales season, Ross Stores’ comparable store sales for August increased 8% compared with 4% in the prior-year period ended on August 27, 2011. Consequently, the company’s total sales for the four-week period surged 13% to $747 million compared with $659 million in the year-ago period.
Further, Ross Stores reported seven months comparable store sales gain of 8% versus a 4% increase registered in the year-ago period. Net sales for the period rose 13% to $5,445 million from $4,823 million in the year-ago quarter.
Robust sales mainly mirror the company’s relentless focus on offering exciting collection in its name-brand fashion for the family and home, which appeals to its value-oriented customers.
Looking ahead, the company has provided its same-store sales growth expectations for the month of September and October. Ross Stores expects same-store sales to grow in the range of 2% – 3% in September and 3%– 4% in October, 2012.
One of Ross Store’s competitors, Gap Inc. (GPS - Analyst Report) , registered a 9% rise in its August 2012 comparable store sales. The company’s another competitor, Nordstrom Inc. (JWN - Analyst Report) , also reported positive same-store sales of 21% for the month of August 2012.
Ross Stores has implemented a micro-merchandising tool, through which the company expects to enhance its total sales and profitability by targeting expansion in its existing markets. Moreover, Ross remains focused on new store growth, share buybacks and attractive dividend payouts even as many other retailers are implementing dramatic cutbacks, and has the financial strength to continue its course and build shareholder value.
Ross Stores' shares maintain a Zacks #2 Rank, which translates into a short-term Buy rating.
Ross Stores and its subsidiaries operate two chains of off-price retail apparel and home accessory stores in the U.S. These stores offer branded apparel, shoes, and accessories for the entire family, as well as gift items, linens, and other home-related merchandise. The company also offers small furniture and furniture accents, educational toys and games, luggage, gourmet food and cookware, watches, sporting goods and fine jewelry, which provide it with a competitive edge over its rivals.