Ross Stores tops sales, earnings estimates; raises guidance

Shoppers just can't stay away from off-price stores.



Ross Stores' earned $317 million, or 82 cents a share, in the quarter ended July 29, up 15% from $282 million, or 71 cents a share, in the year-ago period. Analysts had expected earnings of $0.76 per share.



Sales rose 8% to $3.43 billion. Same-store sales increased 4%.



"We are pleased with the better-than-expected growth we delivered in both sales and earnings in the second quarter, especially given our strong multi-year comparisons and today’s volatile retail climate," said Barbara Rentler, CEO. "Operating margin of 14.9% outperformed our projections, mainly due to a combination of higher merchandise margin and leverage on our above-plan sales gains.”



For the first six months of fiscal 2017, Ross earnings per share were $1.64, up 14% on top of a 9% increase last year. Net earnings were $638 million, up from $573 million in the prior year. Sales rose 7% to $6.73 billion. Same-store sales increased 4%.



The company forecast fourth-quarter same-store sales growth of 1% to 2%, with per-share earnings between 88 cents and 92 cents.



Ross said it now expects fiscal 2017 earnings per share to increase 12% to 14% to $3.16 to $3.23, on top of a 13% gain last year.



Ross Stores operates 1,384 locations in 37 states, the District of Columbia and Guam.