TJX TJX Companies Inc

Ross Stores Inc. (ROST), the second largest off-price retailer of apparel and home accessories, reported a growth of 5.0% in comparable store sales for the four weeks ended October 29, 2011. October same-store sales came in better than the company's forecast of a 1% to 2% increase for the month.

For the month under review, sales increased 10.0% to $661.0 million from $600.0 million in the year-ago period. Regionally, Florida was the top performing market with categories like Juniors and Shoes positively influencing results.

Comparable store sales for third-quarter ended October 29, 2011, grew 5.0% from the prior-year quarter. However, sales surged 9.0% to $2,046 million compared with sales of $1,874 million in the year-ago quarter.

Comparable store sales for nine months ended October 29, 2011, increased 5.0% compared with a rise of 6% in the prior-year period. Total sales for the period rose 9.0% to $6,210.0 million from $5,721.0 million a year ago.

Execution during the month and the nine-month period was driven by the company's aptitude in providing attractive brand name bargains to customers, who value both quality and price.

Ross' nearest competitor, The TJX Companies Inc. (TJX), reported an increase of 3.0% in same-store sales for the month.

Guidance

Driven by the ahead-of-plan sales and merchandise gross margin results in October 2011, the company now expects earnings per share to be in the range of $1.25 to $1.26 for the 13 weeks ending October 29, 2011, an upside from the previous earnings per share guidance of $1.16 to $1.18. The current Zacks Consensus Estimate for the quarter is $1.26 per share coinciding with the upper end of guidance range.

For fiscal 2011, the company now anticipates earnings in the range of $5.54 to $5.61 per share, an increase of 20.0% to 21.0% over fiscal 2010. The current Zacks Consensus Estimate for the fiscal stood at $5.59 per share.

We  believe  that  Ross'  continuous effort to increase  its store  base  coupled  with  the  ability  to  deliver positive comparable same-store  sales  will  augur well for  its top-line growth.

Ross' shares maintain a Zacks #1 Rank, which translates into a short-term ‘Strong Buy’ rating. Our long-term recommendation on the stock remains ‘Outperform’.

 
ROSS STORES (ROST): Free Stock Analysis Report
 
TJX COS INC NEW (TJX): Free Stock Analysis Report
 
Zacks Investment Research