Ross Stores, Inc. fundamental checkup using revenue growth, EPS growth, free cash flow, margins, ROIC, debt-to-equity, and TGMCharts chart exhibits as of September 18, 2026.
Ross Stores, Inc. presents a highly aligned fundamental profile where top-line expansion of 7.18% translates into an EPS CAGR of 94.40% and a free-cash-flow CAGR of 13.59%, underpinned by a net margin of 10.85% and an ROIC of 22.56%.
This assessment synthesizes operating trajectory, shareholder yield conversion, cash flow coverage, capital efficiency, and liquid reserves. With a current ratio of 1.61x and a debt-to-equity ratio of 0.70x, the balance sheet provides a solid foundation rather than acting as an operational constraint.
Ross Stores, Inc. has market cap of $72.69B and closed at $227 on September 18, 2026.
Five-year revenue CAGR is 7.18% and five-year EPS CAGR is 94.40%.
Five-year free-cash-flow CAGR is 13.59%.
Net margin is 10.85% and ROIC is 22.56%.
Current ratio is 1.61x and debt-to-equity is 0.70x.
Fundamental snapshot
The valuation, growth, profitability, and balance-sheet facts behind the checkup.
A Unified View of Growth Profitability and Balance Sheet Strength
To evaluate Ross Stores, Inc. objectively, analysts must determine whether the underlying growth, cash generation, profitability quality, balance sheet flexibility, and market valuation present a cohesive operational narrative. With the stock closing at $227 on September 18, 2026, this fundamental checkup prioritizes hard operational evidence before assessing the prevailing market valuation.
The core analysis evaluates a five-year revenue CAGR of 7.18% alongside a five-year EPS CAGR of 94.40%, cross-referencing these metrics against a five-year free cash flow CAGR of 13.59%. Relying on a single growth vector can obscure structural shifts, making a multi-dimensional analysis essential for evaluating long-term performance.
Current compounder snapshot · ROST
Live supporting context; not part of the article's frozen 2026-09-18 evidence snapshot.
Operational Profile and Sector Context within Consumer Cyclicals
As a major player in the Consumer Cyclical sector, Ross Stores, Inc. must be evaluated through its tangible operational outputs: top-line expansion, operating margins, reinvestment efficiency, and balance sheet leverage. This comprehensive snapshot integrates market capitalization, valuation multiples, growth rates, and leverage ratios to establish a clear baseline before analyzing specific financial trends.
Fundamental evidence table
A compact cross-check of valuation, growth, quality, and financial flexibility.
Revenue history shows whether the business has been expanding before margins and per-share metrics are considered. Q2 FY2026 (2026-08-01): $6.26B.
+102.96% over 10Y
tgmcharts.com
Five-year revenue CAGR: 7.18%. This is endpoint-to-endpoint across the five-year window — a depressed start year can inflate it, so read it against the recent bars.
Five-year revenue CAGR of 7.18% is the top-line test. A fundamental checkup becomes more durable when revenue growth is paired with earnings growth instead of depending only on margin expansion.
Analyzing Top Line Expansion and Bottom Line Shareholder Returns
Evaluating growth conversion reveals how effectively top-line sales expansion translates into bottom-line net income for shareholders. The company's five-year revenue CAGR of 7.18% represents steady top-line demand, while the five-year EPS CAGR of 94.40% indicates substantial operating leverage or share count reduction. When per-share earnings expand at a faster rate than total sales, analysts must scrutinize the underlying cash flows and operating margins to verify the sustainability of this trend.
EPS
ROST EPS
$2.68
EPS history shows how much of the business growth has reached shareholders. Q2 FY2026 (2026-08-01): $2.68.
+325.40% over 10Y
tgmcharts.com
Five-year EPS CAGR: 94.40%. This is endpoint-to-endpoint across the five-year window — a depressed or negative start year can inflate it, so read it against the recent bars.
Five-year EPS CAGR of 94.40% is the shareholder conversion check. If EPS grows faster than revenue, the note should ask whether that came from margin quality, buybacks, or a temporary base effect.
Verifying Earnings Quality with Long Term Cash Generation Trends
Free cash flow serves as the ultimate reality check on reported accounting profits. With a five-year free cash flow CAGR of 13.59%, the cash flow trend is examined alongside earnings growth to ensure that reported net income is fully backed by cash collections. A persistent divergence where cash flow growth lags behind EPS expansion would signal potential working capital friction or aggressive capitalization policies.
free cash flow
ROST free cash flow
$624.50M
Free cash flow checks whether earnings are converting into owner cash. Q2 FY2026 (2026-08-01): $624.50M.
+253.51% over 10Y
tgmcharts.com
Five-year free-cash-flow CAGR: 13.59%. This is endpoint-to-endpoint across the five-year window — a depressed or negative start year can inflate it, so read it against the recent bars.
Free-cash-flow CAGR of 13.59% is the counterweight to the EPS story. If cash flow lags earnings, the quality of the fundamental setup deserves a more cautious reading.
Assessing Net Profit Margins and Reinvestment Efficiency
The durability of historical growth depends heavily on the company's profitability profile, highlighted by a net margin of 10.85% and a return on invested capital (ROIC) of 22.56%. The net margin reflects the percentage of sales converted into net profit, while the high ROIC demonstrates that the capital redeployed back into the store network continues to generate strong economic returns.
net margin
ROST net margin
13.59%
Net margin is the operating-quality check behind the growth record. Q2 FY2026 (2026-08-01): 13.59%.
+5.7pp over 10Y
tgmcharts.com
Net margin (TTM): 10.85%. The bars below are reported fiscal periods (quarterly where available).
Net margin of 10.85% shows how much revenue becomes profit. The checkup is stronger when margin quality supports EPS growth rather than simply flattering one recent period.
ROIC
ROST ROIC
22.56%
ROIC tests whether the business earns enough on reinvested capital to deserve attention. Q2 FY2026 (2026-08-01): 22.56%.
-9.0pp over 10Y
tgmcharts.com
Latest ROIC: 22.56%.
ROIC of 22.56% is the reinvestment-quality check. A business with stronger returns can support a better long-term read even when the valuation is not obviously cheap.
Liquidity Reserves and Capital Structure as Operational Guardrails
Balance sheet flexibility provides the necessary cushion to navigate cyclical downturns and fund expansion without distress. The company maintains a current ratio of 1.61x and a debt-to-equity ratio of 0.70x. These metrics are crucial because even highly profitable retailers can face operational bottlenecks if short-term liquidity contracts or if debt obligations rise excessively relative to equity.
debt-to-equity
ROST debt-to-equity Chart
0.84x
Debt-to-equity keeps the checkup honest about balance-sheet flexibility. Historical series through 2026-01-31.
-51.72% over 5Y
tgmcharts.com
Latest debt-to-equity ratio: 0.70x.
Debt-to-equity of 0.70x and current ratio of 1.61x are the balance-sheet checks. They matter because growth and margins are less valuable if financial flexibility is narrowing.
Evaluating Current Multiples Against Historical Operating Performance
Market valuation should be analyzed as the final piece of the puzzle, representing the expectations already priced in by market participants. The stock trades at a trailing price-to-earnings multiple of 27.43x, which corresponds to an earnings yield of 3.65%. This valuation framework indicates the level of future growth and operational execution that the market expects the business to sustain.
The close at $227 is not the conclusion, but it is the market reference point. The fundamental read has to explain whether growth, margins, and balance-sheet support justify the price investors are paying.
Weighing Operational Strengths Against Structural Risks
The optimistic scenario relies on the company's ability to maintain its top-line trajectory, convert earnings to cash, and sustain high capital returns while preserving its liquid balance sheet. Conversely, the primary risk is that rising operational costs or inventory pressures could compress margins, causing free cash flow to diverge from earnings while the market multiple remains elevated based on historical averages.
Bull and bear case
Fundamental support
Five-year revenue CAGR of 7.18% and five-year EPS CAGR of 94.40% support the business case.
Net margin of 10.85% and ROIC of 22.56% are the quality checks behind the thesis.
Fundamental pressure
Free-cash-flow CAGR of 13.59% can weaken the read if it falls away from EPS growth.
Debt-to-equity of 0.70x and current ratio of 1.61x are the balance-sheet checks that can change the view.
Concluding Analytical Assessment and Key Monitoring Metrics
This fundamental baseline will require revision if upcoming quarterly disclosures show a material shift in revenue growth, cash conversion efficiency, or balance sheet leverage away from the historical levels presented here. This analysis is intended solely as general research context and does not constitute personalized financial advice or a specific investment recommendation.
FAQ
What is the fundamental read on ROST?
Ross Stores, Inc. is judged through revenue growth of 7.18%, EPS growth of 94.40%, free-cash-flow growth of 13.59%, net margin of 10.85%, and ROIC of 22.56%.
Which ROST fundamental metric matters most?
No single metric carries the article. The checkup requires growth, cash conversion, profitability quality, balance-sheet flexibility, and valuation to be read together.
When should this ROST checkup refresh?
Its figures are as of September 18, 2026, the note's dated snapshot; a note whose figures stop verifying against reported data is corrected or unpublished.
What would change our mind
Revenue growth moving away from the current five-year CAGR of 7.18%.
Free-cash-flow growth drifting away from five-year EPS CAGR of 94.40%.
ROIC or balance-sheet flexibility weakening from ROIC of 22.56% and debt-to-equity of 0.70x.
The bottom line
Ross Stores, Inc. fundamental research note from TGMCharts Research, grounded in a dated fundamentals snapshot, chart exhibits, and linked source facts.
Every number in this note comes from data we compute and store ourselves from the company's reported figures, plus verbatim excerpts from its SEC filings. When a value isn't available we say so — we never fill gaps with estimates.
“Distribution costs decreased 100 basis points mainly due to the timing of packaway inventory carrying costs, higher productivity, and tariff-related processing costs in the second quarter of fiscal 2025.”
“Partially offsetting these benefits were higher domestic freight costs of 10 basis points due to increased fuel prices and higher buying costs of 5 basis points from higher incentive compensation expense.”
“Distribution costs decreased 60 basis points mainly due to the timing of packaway inventory carrying costs, higher productivity, and tariff-related processing costs in the second quarter of fiscal 2025.”
“Operating income was $1,104 million, which included a benefit of approximately $253 million related to refunds of IEEPA tariffs paid, compared to $638 million in the second quarter of fiscal 2025.”
Every numeric or dated claim in this note was checked against our stored company data before publishing — each figure below links to the page it comes from.
