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Will Ross Stores Beat Ests this Time?

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Ross Stores Inc. (ROST - Free Report) is set to report its fourth quarter fiscal 2012 results on Mar 21. The company’s earnings for the last reported quarter surged 11% year over year to $1.07 per share and remained in line with the Zacks Consensus Estimate. Let’s see how things are shaping up for this announcement.

Growth Factors in the Past Quarter

The year-over-year increase in the third quarter fiscal 2013 earnings per share was primarily driven top line growth. We believe that Ross Stores’ relentless focus on offering exciting collection in its name-brand fashion for the family and home, which appeals to its value-oriented customers resulted for such a strong quarterly performance. Moreover, we consider that Ross Stores has benefited from continued focus on cost reduction initiatives. Further, as the U.S. economy is showing signs of stabilization, we believe that Ross Stores is well positioned to capitalize on the opportunity.

Earnings Whispers?

Our proven model does not conclusively shows that Ross Stores is likely to beat the earnings this quarter. A stock needs to have both a positive Earnings ESP (Read: Zacks Earnings ESP: A Better Method) and a Zacks Rank #1, #2 or #3 to surpass the earnings estimates. However, that is not the case here, owing to the following factors:

Zacks ESP: ESP for Ross Stores is 0.00% since the Most Accurate Estimate stands at $1.07, which is in line with the Zacks Consensus Estimate.

Zacks #3 Rank (Hold): Ross Stores’ Zacks Rank #3 (Hold) lowers the predictive power of ESP because the Zacks Rank #3, when combined with a 0.00% ESP, makes surprise prediction difficult. We caution against stocks with Zacks #4 and #5 Ranks (Sell rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Other Stocks to Consider

There are other companies you may want to consider in the same sector. Our model shows that the following have the right combination of elements to post an earnings beat this quarter:

Cabela’s Inc. has an Earnings ESP of +11.54% and a Zacks Rank #1 (Strong Buy).

Lumber Liquidators Holdings Inc.’s (LL - Free Report) Earnings ESP stands at +2.33% and it carries a Zacks Rank #1 (Strong Buy).

Pilgrim’s Pride Corporation (PPC - Free Report) with an Earnings ESP of +69.23% holds a Zacks Rank #1 (Strong Buy).

In-Depth Zacks Research for the Tickers Above

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Ross Stores, Inc. (ROST) - free report >>

Pilgrim's Pride Corporation (PPC) - free report >>

Lumber Liquidators Holdings, Inc (LL) - free report >>

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