Jim Cramer on Ross Stores: "I'm Happy to Put Ross at Second"

Ross Stores, Inc. (NASDAQ:ROST) is one of the stocks Jim Cramer put under the microscope. Cramer mentioned the stock during the episode and said:

“In the third place, there’s Ross Stores… which saw just 1% same-store sales growth in the first half. In the most recent quarter, their same-store sales came in a little light… These guys had pulled their full-year forecast earlier in the year in response to the Liberation Day tariffs, but now they got a better handle on the situation, so management reissued their full-year earnings guidance with the upper end of their range just above Wall Street’s consensus estimate, basically inline numbers, so the stock did rally just 1% the next day.

Now, the fact that Ross actually wasn’t slaughtered… for doing a little bit less than some people expected shows you just how much Wall Street really likes this whole group. Now that we know how all three off-price apparel companies are doing, what about paying for numbers?… Alright, in terms of cheapness, Ross Stores leads the way, trading just 22 times next year’s earnings estimates. That is very cheap, much cheaper than Burlington at 25 and then TJX at roughly 28 times next year’s numbers…

Ross Stores is at 2.2 (PEG ratio)… They bought back 260 million of their own shares last quarter, maintaining their plan to repurchase $1.05 billion of stock for the year. That’s not bad… While Ross Stores noted that their top priority will always be providing high-quality merchandise at outstanding value, they just don’t have the scale advantage that TJX has. But given all the other factors I just mentioned, I’m happy to put Ross at second.”

Ross Stores, Inc. (NASDAQ:ROST) operates off-price retail chains providing apparel, footwear, accessories, and home fashion products to value-focused consumers.

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Disclosure: None. This article is originally published at Insider Monkey.