Ross Stores Inc. (NASDAQ: ROST) reported its fiscal second-quarter earnings Thursday after the markets closed. The company had $0.63 in earnings per share (EPS) on $2.97 billion in revenue. That compared to Thomson Reuters consensus estimates of $0.62 in EPS and revenue of $2.94 billion. In the second quarter of the previous year, the retailer posted EPS of $0.57 on $2.73 billion in revenue.
Source: thinkstock
Second-quarter sales rose 9% year over year while comparable sales rose 4%.
The company gave guidance for the fiscal third quarter. Ross expects comparable sales to increase 1% to 2%, on top of a 4% increase in the prior year, and EPS in the range of $0.48 to $0.50. Consensus estimates are $0.50 in EPS on $2.77 billion in revenue.
It is worth noting that all EPS results and forecasts for both the current and prior year reflect the company’s recent two-for-one stock split that became effective on June 11, 2015.
During the quarter, the company repurchased 3.5 million of its shares for an aggregate price of $176 million. As planned, Ross expects to buy back a total of $700 million in common stock during fiscal 2015 under its two-year $1.4 billion authorization.
CEO Barbara Rentler commented on earnings:
We are pleased with our solid sales and earnings growth for both the second quarter and first six months. These results reflect that our assortments of compelling name brand bargains continue to resonate with today’s value-focused customers.
She continued:
While we hope to do better, we are maintaining a cautious outlook for the second half when we face more challenging sales and earnings comparisons. In addition, the macro-economic and retail landscapes remain uncertain.
On the books, the company had $630.3 million in cash and cash equivalents, compared to $549.8 million in the same period of the previous year.
Shares of Ross closed Thursday down 0.8% at $55.25. Following the release of the earnings report, shares were down a further 9.5% to $50.02. The stock has a consensus analyst price target of $54.37 and a 52-week trading range of $34.46 to $56.68.
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