Ross Stores stock gains on earnings beat, outlook
Yahoo Finance Live anchors discuss quarterly earnings for Ross Stores and the broader retail environment.
Video transcript
JULIE HYMAN: You know what else we talked about a little bit at the top of the show is who else is benefiting are the off-price retailers, the ones who get that overflow inventory merchandise. Not just your typical Jordan store, but--
BRAD SMITH: I'd love to pick up some Lebron's at Target.
JULIE HYMAN: Yeah, but well, Ross Stores--
BRAD SMITH: Oh, Ross.
JULIE HYMAN: TJX, right? I don't know that they are selling LeBron's at those places yet--
BRIAN SOZZI: Target was selling Beyond Meat meatballs, though.
JULIE HYMAN: --but Ross Stores is one of the stocks that we pointed out at the top of the show is doing well. The stock is up 16% here this morning. And one analyst says-- Michael Binetti over at Credit Suisse says gross margin is going to turn positive year over year for the first time since the second quarter of 2021 in this company's third quarter.
So if that's the case, then that would be quite a turnaround in this environment here. And the company's fourth quarter forecast leaves it a little room to either beat or miss, but it looks like the third quarter is really what folks are paying attention to here.
BRAD SMITH: Yeah, those third quarter results above their expectations, saying that they had stronger values throughout their stores. And that value play is what some consumers, and I would argue many consumers, to your point, are looking for.
If you only have or are hearing about the affluent consumer being the most resilient right now-- and even that's starting to kind of bleed into their own balance sheets as well and their financials-- then what does that mean for the consumers who are already pinching pennies, and have been doing that for months now?