Ross Stores dips after warning on the impact of inflation on consumer spending
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Ross Stores (NASDAQ:ROST) dipped slightly in postmarket trading after the off-price retailer's profit guidance took the wind of the sails of a Q1 earnings topper.
Comparable sales rose 1% year-over-year during Q1 despite continued inflationary pressures that impacting low-to-moderate income customers. Operating margin for the period was down 70 basis points from a year ago to 10.1%, primarily reflecting higher incentive compensation versus last year when Ross Stores said it underperformed expectations.
The company bought 2.2M shares of its own stock during the quarter for an aggregate amount of $234M. Merchandise inventory at the end of the quarter was $2.24B vs. $2.67B a year ago. The retailer ended the quarter with 2,034 stores vs. 1,965 a year ago.
CEO outlook: "There remains a high level of uncertainty in todayâs macro-economic and geopolitical environments. In addition, prolonged inflationary pressures continue to negatively impact our low-to-moderate income customersâ discretionary spend. As such, we remain focused on delivering the most compelling values possible to maximize our opportunities for growth."
Ross Stores (ROST) guided for full-year EPS of $4.77 to $4.99 vs. a pior view for $4.65 to $4.95 amd the consensus mark of $4.93.
Shares of Ross Stores (ROST) were down 0.66% in late trading on Thursday and are down more than 9% for the year.
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