A Look at Ross Stores’s (ROST) Valuation Following Completion of Its 2025 Expansion Targets

Ross Stores (ROST) just wrapped up its planned fiscal 2025 store growth by opening 40 new locations across 17 states, reaching its annual target of 90 additions. This expansion nudged the stock upward as investors took note.

See our latest analysis for Ross Stores.

Ross Stores has been on a roll this year, with its rapid nationwide expansion and refreshed store formats sparking fresh investor interest. That momentum is showing up in the numbers as well: after climbing more than 20% over the past 90 days, the share price now sits at $156.31. Meanwhile, a solid 5.44% total shareholder return over the past year reflects steady long-term gains.

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But after such a strong run and ambitious expansion, is Ross Stores still flying under the radar, or have recent gains already captured all that future growth? This leaves investors to question whether a new buying opportunity exists.

Most Popular Narrative: 3.7% Undervalued

The consensus narrative's fair value estimate of $162.29 is just above the recent close at $156.31, suggesting the market may still have some upside to price in. The analyst narrative frames Ross Stores as a business still benefiting from strategic moves and operational tailwinds.

The expansion into new and underpenetrated geographic markets, including successful entries into the New York Metro area and Puerto Rico, leverages ongoing population shifts to urban and suburban clusters. This provides a tangible runway for both revenue and earnings growth through increased store count and enhanced productivity of new locations.

Read the complete narrative.

How does a traditional brick-and-mortar retailer end up with a valuation that rivals fast-growing tech names? The secret lies in optimistic projections about expansion, improved margins, and earnings growth that only a select few are forecasting. To learn which financial levers could help achieve this price target, take a closer look at the underlying narrative.

Result: Fair Value of $162.29 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, risks remain, including rising costs and potential saturation from rapid store expansion. Both of these factors could challenge the bullish outlook on Ross Stores.

Find out about the key risks to this Ross Stores narrative.

Build Your Own Ross Stores Narrative

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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