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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Ross Stores, Inc. (XNAS:ROST) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
ROST
Name:
ROSS STORES, INC. (XNAS:ROST)
Sector:
615.88M
Industry:
Apparel Retail
CEO:
Ms. Barbara Rentler
Total Employees:
100,000
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is 15.83% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF ROSS STORES, INC.(ROST) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND APPAREL RETAIL INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
87.39
One Month Price Target:
$87.88
Six Month Price Target :
$90.3
Likely Price in One Year's Time:
Ticker:
$93.22
Likely Trading Range Today Under (Normal Volatility)
$86.96
Price Upper limit ($) :
$87.82
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$82.18
This week:
$75.75
This month :
$64.11
Other Primary facts
Market Cap:
30.35B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
349.93M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
16.63%
-22.47%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$111.56
$100.57
$63.22
$74.21
Medium risk (<10%) entry points
Buy Call
Sell Call
$96.99
Buy Put:
Sell Put:
$94.64
$77.76
$80.14
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
ROST
Sharpe Ratio:
-0.20%
Comparison:
ROST, is amongst the top 40% stocks with lowest risk-adjusted returns
Sharpe ratio is -129.12% lower than the industry
& is -108.86% lower than the market/S&P 500 average
Average Returns/Yield of
ROST
Daily returns:
0.00%
Weekly returns:
0.01%
Monthly returns:
0.06%
Yearly returns:
8.86%
Comparison of returns:
Average annual returns/yield (last 3 years) is -91.91% below industry average
Classification:
ROST, is amongst the top 40% lowest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.75
Statistical test of Returns:
ROST has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.90%
Weekly Volatility:
6.49%
Monthly Volatility:
12.98%
Yearly Volatility:
44.96%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.71%
Volatility in last five trading days has been -40.98% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.96%
Weekly VaR:
-13.32%
Monthly VaR:
-26.64%
How Much Can the price of
ROST
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-24%
Worst case (decline):
-92.29%
This translates to price declining to:
$66.83
This translates to price declining to:
$6.74
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
ROST is a 88.03% riskier investment compared to the market/S&P 500 & is 61.09% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -25.21% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
ROST
Beta in relation to market/S&P 500--0.99
Expected beta in 1 year's time:
0.763
Expected beta in 3 year's time:
1.078
Unlevered (debt free) Beta:
0.487
Beta in relation to Nasdaq (XNAS):
0.887
Beta in relation to all global stocks::
0.73
Beta Comparison & Analysis
Beta of competitors/peers::
1.387
Beta is -28.48% lower than peers
Average Industry Beta:
1.366
Beta is -27.41% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
32.19%
Sustainable growth rate is -21.16% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.092
Alpha is 153.02% above industry average alpha yield
Alpha is -587% below the market average
Analysis of Cost of Capital of
ROST
Equity cost of capital:
0.099
Equity cost of capital is -20.51% below industry mean WACC
Unlevered (without debt) cost of capital:
4.88%
Before-tax cost of debt:
0.97%
After-tax cost of debt:
0.76%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
0.76%
WACC is -11.93% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$53.53
Revenue growth rate per share of (3Y):
8.37
Annual revenue growth rate is -147.06% below industry average
EPS:
$4.50
Expected Annual growth rate of EPS (3Y):
4.24%
Expected future EPS growth rate is -79.80% lower than the Apparel Retail industry
Free cash flow (FCF) per share:
$0.11
Balance sheet equity growth per share: -55.69%
Equity growth rate per share is 94.67% higher than the industry
Debt per share
$14.26
EBITDA per share
$7.16
Valuation Analysis Today of
ROST
P/E Ratio:
20.73
P/E Ratio of Competitors/Peers:
1405.74
P/E ratio is -98.53% lower than main peers & is 50.81% higher than the industry
Stock price/value with industry average P/E ratio: $61.86
ROST is 41.27% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $299.35
Present value of the expected future dividends only: $17.46
P/S (Price to Sales ratio):
1.63
Price to sales ratio is 88.29% above the industry mean
P/B (Price to book value ratio):
8.37
Price to free cash flow: 790.18
Price to free cash flow ratio is 10.69% higher than the industry
Net income growth rate (3Y):
-93.22%
Net income growth rate is 50.46% higher than the average industry net income growth rate
Dividend Analysis
Dividend payout rate: 6.41%
Dividend yeild: 1.36%
Previous Dividend: $0.31
Previous adjusted dividend: $0.31
Previous Dividend: $1.19
Expected next dividend best case: $0.33
Expected next dividend worst case: $0.29
Average dividend payment (long-term): $0.29
Average dividend increase/decrease (growth rate) % per period: 2.93%
Expected next dividend payment date: 28/09/2022
Expected next dividend record date: 09/05/2022
-
Previous dividend payment date: 30/06/2022
Previous dividend record date: 06/07/2022
-
Dividend History:
2022-06-06--$0.31
2021-12-06--$0.29
2021-06-07--$0.29
2022-03-14--$0.31
2021-09-03--$0.29
2021-03-15--$0.29
Dividend growth rate is -108.57% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
136.65%
Net debt to equity ratio:
7.92%
Debt to assets ratio:
37.26%
Net debt to assets ratio:
2.16%
Debt-to-asset ratio is -42.11% below industry average
Ability to repay debt:
Interest coverage ratio:
45.84
Interest coverage ratio is -79.79% less than industry average
Looking forward:
Debt growth rate:
1732.20%
Annual debt growth is 553% higher than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.639
Statistical significance of correlation:
ROST has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.453
Stock price is 41.14% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.453
Correlation of price movement with Nasdaq (^IXIC):
0.019
Covariance of price movement with the market:
0.032
Kurtosis
12.597
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
-0.512
Returns are left (negative) skewed; mean returns are lower than median and mode returns
Fundamental Analysis & Dupont Analysis of
ROST
Gross Profit Margin Ratio:
107%
Operating Profit Margin Ratio:
11.52%
Operating profit margin is 55.24% higher than the industry
Net Profit Margin Ratio:
107%
Effective Tax Rate:
23.98%
Effective tax rate is -9.05% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
43.38%
Return on equity (ROE) is 4.79% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
11.83%
Return on assets (ROA) is 13.10% higher than the industry
Financial Leverage:
1.6x
Current Ratio:
1.72
Current ratio is -1.25% below industry average
Cash Conversion Cycle (days):
-0.1
Cash conversion cycle is -100.13% below industry average
The remaining useful life of property plant & equipment is: 1.6 years
Stock based compensation to net income ratio:
1.81%
In-depth Efficiency Analysis
Revenue generated per employee:
187.3K
Each employee generates -52% less revenue than industry average revenue per employee
EBITDA generated per employee:
25.0K
Each employee generates -49% less EBITDA than industry average revenue per employee
Profit generated per employee:
15.8K
Each employee generates -38% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
6.2K
Each employee generates -7% less free cash flow than industry average revenue per employee
Assets/Capital per employee
59.6K
Each employee generates -7% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
ROST
EBAY INC. (XNAS:EBAY)
Li Auto Inc. (XNAS:LI)
LULULEMON ATHLETICA INC. (XNAS:LULU)
EXPEDIA GROUP, INC. (XNAS:EXPE)
TRACTOR SUPPLY COMPANY (XNAS:TSCO)
ETSY, INC. (XNAS:ETSY)
ULTA BEAUTY, INC. (XNAS:ULTA)
POOL CORPORATION (XNAS:POOL)
MARRIOTT INTERNATIONAL, INC. (XNAS:MAR)
Current Analyst Ratings
Strong buy�25%
Buy�46%
Hold�33%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
4/30/22
Revenue:
18.73B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
13.71B
5.03B
-
-
2.87B
-
-
2.87B
405.00K
54.64M
365.26M
2.50B
2.16B
1.58B
2.08B
499.87M
1.58B
Statement of Cash Flow
Date:
Period:
87.51M
Differed Income Tax :
25.45M
Stock Based Compensation :
28.67M
Change in Working Capital :
134.71M
Accounts Receivables:
-
Other Working Capital:
1.79M
Other Non-Cash Items:
-
Net Cash Provided by Operating Activities:
752.82M
Investments in PP&E:
- 136937.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
4/30/21
2022
Q1
5.37B
-
5.37B
167.14M
1.70B
199.39M
7.43B
5.72B
-
-
-
-
245.72M
5.96B
-
13.40B
2.57B
664.78M
172.28M
-
1.08B
4.32B
4.99B
285.76M
5.42B
-
9.74B
3.57M
2.56B
- 3436071.0K
4.52B
April 30, 2021 at 6:00:00 AM
16.58B
3.65B
13.40B
-
5.66B
289.3M
-
-
- 136937.00K
-
-
- 47378.00K
- 101519.00K
6.06M
- 142834.00K
-
473.05M
5.43B
4.95B
752.82M
- 136937.00K
615.88M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
ROST
2023
2024
2025
2026
2027
$93.69
$1,846.42
$1,969.49
$2,100.77
$2,240.80