ROST
Ross Stores, Inc.
Consumer Cyclical · Apparel Retail · United States · Stock
Score Breakdown
Scored for Dividend Income profile
Sub-scores are 0–20 each; Model Score is weighted by your selected investment goal. How it works →
Why Ranked Here
- The composite score of 65.0/100 reflects strong contributions from financial health, dividend consistency, and momentum, all of which scored above midpoint [financial_health.debt_to_equity, dividend.dps_trend, momentum.revenue_quarterly].
- Profitability metrics including an 11.9% operating margin, 9.4% net margin, and 13.8% return on assets supported a solid above-midpoint profitability score [profitability.operating_margin_pct, profitability.net_margin_pct, profitability.roa_pct].
- The absence of a macro theme assignment and the lag between revenue and earnings growth both weighed on the composite, preventing a higher overall score [theme.none, growth.revenue.yoy, growth.net_income.yoy].
Why Not Higher
- Earnings growth significantly lagged revenue growth in FY2026 — net income rose only 2.6% against 7.7% revenue growth — tempering the growth score [growth.revenue.yoy, growth.net_income.yoy].
- The theme component contributed no score because Ross Stores is not currently assigned to any of the 24 tracked macro themes, which structurally limits the composite [theme.none].
Data Confidence
10 / 10
Very High — full data coverage
Why This Score
Grounded in figures from this company's SEC EDGAR filings — not a restatement of the score itself.
Revenue grew 7.7% from FY2025 to FY2026, while net income rose only 2.6% over the same period and diluted EPS increased 4.6% from FY2025 to FY2026.
The model rewarded meaningful top-line expansion but tempered the score because earnings growth lagged revenue growth, suggesting margin pressure or rising costs that limited bottom-line acceleration.
In FY2026, Ross Stores posted an operating margin of 11.9%, a net margin of 9.4%, and a return on assets of 13.8%.
The model rewarded these solid margin and asset-efficiency figures, reflecting a business that converts a meaningful share of revenue into profit and deploys its asset base productively, supporting a above-midpoint profitability score.
In FY2026, Ross Stores carried a debt-to-equity ratio of 0.25 against total assets of $15,548,737,000.
The model rewarded the low leverage indicated by the 0.25 debt-to-equity ratio in FY2026, which signals a conservatively financed balance sheet; the large asset base further supports a high financial health score.
Over the last four quarters, revenue rose sequentially from $4,984,971,000 in 2026Q1 to $6,635,490,000 in 2026Q4, operating income climbed from $606,470,000 in 2026Q1 to $814,115,000 in 2026Q4, and net income increased from $479,249,000 in 2026Q1 to $645,865,000 in 2026Q4.
The model recognized a consistent upward trend across revenue, operating income, and net income through all four quarters, rewarding the steady sequential acceleration with a above-midpoint momentum score.
Dividends per share have risen each year from $1.24 in FY2023 to $1.34 in FY2024, $1.47 in FY2025, and $1.62 in FY2026, while the dividend payout ratio in FY2026 stood at 24.6%.
The model rewarded the consistent multi-year dividend growth trajectory alongside a conservative payout ratio in FY2026, which signals both shareholder return commitment and ample retained earnings capacity, driving a high dividend score.
Ross Stores is not currently assigned to any of the 24 tracked macro themes.
Because no macro theme assignment exists for this security, the theme component contributes no score under the model's current methodology; this reflects the absence of a theme tag and should not be read as a negative signal about the company's business.
Research Summary
AI-generated analysis reflects data and conditions as of the report date shown above. Verify any specific figures through primary sources before acting on this analysis.
Ross Stores delivered solid FY2026 results, with revenue growing 7.7% to $22,750,559,000 and an operating margin of 11.9%, reflecting a business that efficiently converts sales into profit [growth.revenue.yoy, profitability.operating_margin_pct]. The balance sheet remains conservatively financed with a debt-to-equity ratio of just 0.25, and quarterly momentum was consistent throughout the year across revenue, operating income, and net income [financial_health.debt_to_equity, momentum.revenue_quarterly]. The dividend profile is a standout, with dividends per share rising every year from $1.24 in FY2023 to $1.62 in FY2026 at a sustainable 24.6% payout ratio, earning the company a 'Dividend Candidate' label [dividend.dps_trend, dividend.payout_ratio]. The absence of a macro theme assignment tempered the composite score, which stands at 65.0 out of 100 [theme.none].
Plain English
Ross Stores is a steady, well-run retailer that keeps growing its sales and dividend every year, carries very little debt, and consistently turns a healthy share of its revenue into profit — though earnings growth lagged revenue growth in FY2026, and it doesn't currently fit any of the model's tracked macro themes [growth.revenue.yoy, growth.net_income.yoy, dividend.dps_trend, financial_health.debt_to_equity, theme.none].
Bull Case vs. Bear Case
Bull Case
- Dividends per share have grown every year from $1.24 in FY2023 to $1.62 in FY2026, while the payout ratio remains a conservative 24.6%, leaving ample room for continued dividend increases [dividend.dps_trend, dividend.payout_ratio].
- The balance sheet is conservatively financed with a debt-to-equity ratio of 0.25 and total assets of $15,548,737,000, providing financial flexibility and resilience [financial_health.debt_to_equity, financial_health.total_assets].
- Sequential quarterly momentum was consistent across all four quarters of FY2026, with revenue climbing from $4,984,971,000 in Q1 to $6,635,490,000 in Q4 and net income rising from $479,249,000 to $645,865,000 over the same period [momentum.revenue_quarterly, momentum.net_income_quarterly].
Bear Case
- Net income grew only 2.6% in FY2026 despite revenue growing 7.7%, suggesting margin pressure or rising costs that limited bottom-line acceleration [growth.revenue.yoy, growth.net_income.yoy].
- Diluted EPS rose just 4.6% from $6.32 to $6.61, a modest gain that may not satisfy investors seeking stronger earnings growth [growth.eps_diluted.yoy].
- Ross Stores is not assigned to any of the model's 24 tracked macro themes, meaning it does not benefit from any thematic tailwind recognition in the current scoring framework [theme.none].
What Could Change the Picture
Bullish Triggers
- If earnings growth re-accelerates to match or exceed revenue growth, it would signal that the margin pressure observed in FY2026 was temporary, strengthening the overall investment case [growth.revenue.yoy, growth.net_income.yoy].
- Assignment to one or more macro themes could meaningfully improve the composite score and broaden the stock's appeal within the model's framework [theme.none].
Bearish Triggers
- A sustained widening of the gap between revenue growth and net income growth would indicate deepening cost pressures that could eventually threaten the dividend growth trajectory [growth.revenue.yoy, growth.net_income.yoy, dividend.dps_trend].
- Any deterioration in the sequential quarterly momentum trend — particularly a reversal in operating income or net income — would undermine the consistency that currently supports the momentum score [momentum.operating_income_quarterly, momentum.net_income_quarterly].
Risk Profile
Very Low RiskRoss Stores carries a very low risk rating, supported by a debt-to-equity ratio of just 0.25 and a large, stable asset base of $15,548,737,000 [financial_health.debt_to_equity, financial_health.total_assets]. Consistent sequential growth in revenue, operating income, and net income across all four quarters of FY2026 further reinforces the low-risk profile [momentum.revenue_quarterly, momentum.operating_income_quarterly, momentum.net_income_quarterly].
This report is for educational and research purposes only. It does not constitute financial, investment, legal, or tax advice — always conduct your own due diligence before making investment decisions.