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 dividend sub-score of 17.5/20 anchors the overall score at 63.0, as Ross Stores demonstrates strong FCF-backed dividend sustainability and a consistent DPS growth history as reported in its FY2026 10-K.
- The financial health sub-score of 16.0/20 confirms a sound balance sheet with controlled leverage and adequate interest coverage, preventing the score from being pulled down by balance sheet risk.
- All 10 core metrics were successfully mapped from EDGAR at a model confidence of 10.0/10, meaning the 63.0 score reflects a fully data-complete assessment rather than an estimate based on partial information.
Why Not Higher
- The growth sub-score of only 10.0/20 is a significant drag, as the EDGAR filing data shows that YoY revenue, net income, and EPS growth are not at levels that would push the composite score meaningfully above 65.
- The theme sub-score of 0.0/20 contributes no points to the total, and this structural zero prevents the model from reaching the higher scoring tiers even when other components are solid, limiting the ceiling to its current 63.0.
Data Confidence
10 / 10
Very High — full data coverage
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, Inc. is the largest off-price apparel and home fashion retailer in the United States, operating the Ross Dress for Less and dd's DISCOUNTS store chains. The company sources opportunistic merchandise from brand-name suppliers and passes deep discounts to value-conscious consumers, a model that has historically proven resilient across economic cycles. Its FY2026 10-K filing provides all 10 core metrics, giving the model maximum data confidence at 10.0/10. The composite model score of 63.0/100 reflects a company that is structurally sound but not exceptional across every dimension. The dividend sub-score of 17.5/20 is the standout, driven by strong free cash flow coverage of dividend payments, a consistent dividend-per-share growth streak, and a healthy FCF payout ratio — all sourced directly from EDGAR filings. Financial health scores 16.0/20, reflecting manageable leverage and solid interest coverage, consistent with a large, mature retailer. Profitability registers 14.4/20, indicating respectable but not best-in-class net and operating margins, while momentum scores 12.0/20, suggesting quarterly improvement in revenue and earnings is present but not accelerating dramatically. Growth scores 10.0/20, reflecting the measured pace of expansion typical of a mature, large-format retailer rather than a high-growth disruptor. The theme score of 0.0/20 is a structural drag, as the filing does not map to any of the model's tracked macro themes. The core research tradeoff is between Ross Stores' genuine income-generation quality — where its best profile score of 72.2 in dividend income stands out — and its limited appeal for researchers seeking aggressive growth or macro-theme exposure. The medium risk rating acknowledges that while the balance sheet and cash flow are sound, the off-price retail model operates in a competitive, consumer-discretionary environment with ongoing cost and inventory execution sensitivities.
Plain English
Ross Stores runs those big discount clothing stores — Ross Dress for Less — where they sell brand-name clothes and home goods at lower prices than department stores. The model score of 63.0/100 means this is a solid, stable business that scores especially well for dividend income but doesn't show the fast growth or macro-theme tailwinds that would push it into the top tier. The Medium risk rating reflects that while the company is financially healthy and pays consistent dividends backed by real cash flow, it operates in a competitive retail environment where consumer spending habits can shift. It's the kind of research candidate that appeals most to researchers focused on income rather than explosive growth.
Bull Case vs. Bear Case
Bull Case
- The dividend sub-score of 17.5/20 — the highest component in the model — reflects strong free cash flow coverage of dividends, a multi-year DPS growth streak, and a conservative FCF payout ratio all derived from EDGAR filings, indicating durable income generation.
- The financial health sub-score of 16.0/20 confirms that Ross Stores carries manageable leverage and robust interest coverage, meaning the balance sheet can support continued store growth and shareholder returns even in a tighter credit environment.
- The profitability sub-score of 14.4/20 indicates that Ross Stores maintains respectable net and operating margins consistent with its off-price model, which structurally benefits from opportunistic buying that can improve merchandise costs relative to conventional retailers.
Bear Case
- The growth sub-score of 10.0/20 signals that year-over-year revenue, net income, and EPS growth are modest, reflecting the natural pace constraints of a large, mature retailer with thousands of existing locations rather than a high-expansion story.
- The momentum sub-score of 12.0/20 indicates that quarterly improvements in revenue, earnings, and margins are present but not materially accelerating, suggesting limited near-term operational inflection visible in the filing data.
- The theme sub-score of 0.0/20 means the model finds no exposure to tracked macro themes such as AI, energy transition, or reshoring, which may limit the company's appeal to researchers constructing thematically driven research portfolios.
What Could Change the Picture
Bullish Triggers
- An acceleration in revenue and net income growth visible in subsequent EDGAR filings — sufficient to lift the growth sub-score materially above 10.0/20 — would strengthen the research case and push the composite score higher.
- Improvement in the quarterly momentum sub-score above 12.0/20 through consistent margin expansion or earnings acceleration across multiple filing periods would indicate operational improvement beyond the current steady-state profile.
Bearish Triggers
- A deterioration in free cash flow coverage of dividends — reflected in a declining dividend sub-score from its current 17.5/20 — would weaken the primary strength underpinning the research case and the dividend income profile score of 72.2.
- A meaningful increase in leverage or a decline in the interest coverage ratio, as captured in future EDGAR filings, that reduces the financial health sub-score below its current 16.0/20 would indicate balance sheet stress inconsistent with the current medium risk profile.
Risk Profile
Medium RiskThe Medium risk rating for Ross Stores reflects the combination of a healthy balance sheet and strong dividend cash flow coverage on one side, offset by exposure to discretionary consumer spending patterns and the operational complexity of managing large-scale off-price merchandise sourcing in a competitive retail environment. While leverage and interest coverage are solid per the filing data, the modest growth and momentum scores signal limited buffer if consumer demand softens materially.
Key Catalysts to Watch
The key factors to monitor in future EDGAR filings for Ross Stores are free cash flow trends and DPS growth continuity, which underpin the dominant dividend sub-score, and any acceleration in comparable-store revenue or earnings growth that could address the low 10.0/20 growth score. Researchers should also watch whether new macro theme exposures emerge in subsequent filings that could move the theme sub-score above zero and lift the composite model score.
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.