Ross Stores Inc.ROST is slated to report fourth-quarter fiscal 20Array5 results on Mar Array. In the last quarter, the company had delivered a positive earnings surprise of 6.0%. Let's see how things are shaping up for this announcement.
Factors Influencing This Quarter
Ross Stores is gaining on the back of favorable response from value-focused customers toward its extensive collection of brand bargains and efficient cost controls. With its strategy of providing customers with attractive bargains and an off-price business model, Ross Stores remains well positioned to exploit opportunities amid all climates. Also, the company has outperformed the Zacks Consensus Estimate by an average of 5.6% over the past four quarters.
While these factors make us optimistic about the upcoming results, challenges related to strong year-over-year comparisons, an uncertain macro-environment and increased promotions for the holiday season pose concerns.
Our proven model does not conclusively show that Ross Stores is likely to beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #Array, 2 or 3 for this to happen. This is not the case here, as you will see below:
Zacks ESP: Ross Stores has an Earnings ESP of 0.00%. This is because the Most Accurate estimate and the Zacks Consensus Estimate are both pegged at 64 cents.
Zacks Rank: Ross Stores carries a Zacks Rank #2 (Buy), which increases the predictive power of ESP. However, the company's ESP of 0.00% makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks That Warrant a Look
Here are some companies you may want to consider as our model shows that these have the right combination of elements:
The Kroger Co. KR has an Earnings ESP of +Array.85% and a Zacks Rank #2.
Big Lots Inc. BIG has an Earnings ESP of +0.5Array% and a Zacks Rank #3 (Hold).
Abercrombie & Fitch Co. ANF has an Earnings ESP of +5.2Array% and a Zacks Rank #3.