Ross Stores Inc. continues the trend of success in the off-price category with a sales increase for the second quarter.
Net income for the quarter rose 13 percent to $282 million, or 71 cents a diluted share, up from $259 million, or 63 cents, a year ago. This easily beat the 67 cents that FactSet analysts projected.
Sales for the three months ended July 30 increased 7 percent to $3.18 billion from $2.96 billion a year earlier. The sales also topped the FactSet estimate of $3.12 billion. Comp store sales grew 4 percent on top of the 4% growth in the prior year.
“Both sales and earnings results in the second quarter were ahead of our forecast,” said Barbara Rentler. “Higher merchandise gross margin during the quarter drove a 50 basis point increase in operating margin to 14.4%, up from 13.9% in the same period last year.”
Looking ahead, Ross Stores is forecasting a third quarter same store sales gain of 1 percent to 2 percent and earnings per share of 52 cents to 55 cents. This is lower than the FactSet estimate of 57 cents.