Upcoming AWS Coverage on Ascena Retail Group Post-Earnings Results

LONDON, UK / ACCESSWIRE / March 16, 2017 / Active Wall St. announces its post-earnings coverage on Ross Stores, Inc. (NASDAQ: ROST). The Company posted its fourth quarter fiscal 2016 and full year fiscal 2016 financial results on February 28, 2017. The retailer beat top- and bottom-line expectations, as well as the Company's projections, and also announced a $1.75 billion stock repurchase program and a 19% increase in dividend. Register with us now for your free membership at:

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One of Ross Stores' competitors within the Apparel Stores space, Ascena Retail Group, Inc. (NASDAQ: ASNA), reported on March 06, 2017, its fiscal second quarter ended January 28, 2017 financial results. AWS will be initiating a research report on Ascena Retail in the coming days.

Today, AWS is promoting its earnings coverage on ROST; touching on ASNA. Get our free coverage by signing up to:

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Earnings Reviewed

Ross Stores' sales for the quarter ended January 28, 2017, grew 8% to $3.51 billion compared to sales of $3.25 billion in the year ago same period. The Company's reported numbers surpassed analysts' consensus of $3.45 billion of sales. Ross Stores' comparable store sales were up 4% in the reported quarter versus last year, driven by a combination of higher traffic, and an increase in the size of the average basket. Ross Stores' sales for FY16 grew 8% to $12.87 billion compared to sales of $11.94 billion in FY15, with comparable store sales up 4% on top of a 4% increase in the year earlier comparable period.

Ross Stores reported Q4 FY16 operating margin of 13.6%, up 90 basis points from last year, attributed to the Company's plan sales along with a favorable comparison of packaway related costs. For FY16, Ross Stores' operating margin increased 40 basis points to a new record of 14%. The Company's total consolidated inventories were up 7% over the prior year with packaway levels at 49% of total inventory compared to 47% last year.

Ross Stores reported earnings per share for Q4 FY16 of $0.77, up 17% from the prior year's earnings of $0.66 per share, on net earnings that rose 14% to $300.57 million compared to net earnings of $264.16 million. The Company's earnings numbers also exceeded market expectations of $0.75 per share. For the fiscal year, Ross Stores' earnings per share rose 13% to $2.83, while net earnings increased 10% to $1.1 billion.

Barbara Rentler, Chief Executive Officer of the Company, commented:

"We are very pleased with our better-than-expected sales and earnings results for the fourth quarter and fiscal year, especially given our strong multi-year comparisons and the highly competitive and promotional holiday season. Our results continued to benefit from our ability to offer customers great values on a wide assortment of gifts and fashions for the family and the home."

Stock Repurchase Program and Cash Dividend

Ross Stores' Board of Directors authorized a new program to repurchase $1.75 billion of its common stock over the next two fiscal years. At recent stock prices, this new repurchase program represents about 6% of the Company's total market value and a 25% increase over the prior two-year $1.4 billion authorization that was completed in January 2017.

Ross Stores' Board also approved an increase in the quarterly cash dividend to $.16 per share, up 19% on top of a 15% increase in the prior year. This higher quarterly dividend is payable on March 31, 2017, to stockholders of record as of March 10, 2017.

A total of 11.6 million shares of Ross Stores' common stock were repurchased during FY16, for an aggregate purchase price of $700 million. During Q4 FY16, the Company repurchased 2.6 million shares for a total price of $170 million. The Company has repurchased stock as planned every year since 1993 and also raised its cash dividend annually since 1994.

New Locations

In a separate press release on March 06, 2016, Ross Stores announced that it has recently opened 23 Ross Dress for Less® ("Ross") and five dd's DISCOUNTS® stores across 15 different states in February and March. These new locations are part of the Company's plans to add approximately 70 Ross and 20 dd's DISCOUNTS locations during 2017.

Fiscal 2017 Guidance

For the 52 weeks ending January 27, 2018, Ross Stores is forecasting same store sales to grow 1% to 2% compared to 4% last year. For the 53 weeks ending February 03, 2018, earnings per share are projected to be $3.02 to $3.15, up 7% to 11% from $2.83 in fiscal 2016. Incorporated in this guidance range is an estimated benefit to earnings per share of approximately $0.08 from the 53rd week in FY17. For Q1 FY17, the Company is expecting comparable store sales to grow 1% to 2% with earnings per share projected to be $0.76 to $0.79, up from $0.73 in Q1 FY16.

Stock Performance

Ross Stores' share price finished yesterday's trading session at $67.54, marginally up 0.39%. A total volume of 1.36 million shares exchanged hands. The stock has advanced 10.90% and 17.25% in the last six months and past twelve months, respectively. Furthermore, since the start of the year, shares of the Company have gained 3.20%. The stock is trading at a PE ratio of 23.86 and has a dividend yield of 0.95%.

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SOURCE: Active Wall Street