Aug 21 (Reuters) - Ross Stores' shares surged nearly 9% in premarket trading on Friday, after the value retailer raised annual guidance and projected quarterly sales growth above analyst expectations, signalling bargain-hunting demand despite a shaky economic backdrop.
Shares were last up 8.6% at $248.77 after falling over 3% in the last two sessions.
Here are some details:
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The company raised its annual earnings per share forecast to the range of $8.61 to $8.77, compared with its previous outlook of $7.50 to $7.74.
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It expects comparable store sales to increase 6% to 7% in the third quarter and 4% to 5% in the fourth quarter, compared with analysts' expectations of a 3.1% and 2.6% rise, respectively.
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The company had earlier forecast annual same-store sales to rise between 6% and 7%.
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It reported second-quarter revenue of $6.26 billion, a rise of about 13% from a year earlier and beating analyst estimates of $6.18 billion, according to data compiled by LSEG.
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In contrast, earlier this week, rival TJX Companies reported a slowdown at its TJ Maxx and Marshalls discount apparel chains in the second quarter.
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Ross Stores reported an estimate-beating second-quarter EPS of $2.06, which includes an approximate $0.60 per share benefit from tariff refunds.
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"Ross deliberately avoided being the first to raise prices and pass on tariff costs, even intentionally absorbing margin burdens last year. We view this as a savvy move that cemented its low-price leadership and resonated with its customer base," Morningstar analyst Brett Husslein said in a note.
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At least four brokerages, including J.P.Morgan and Barclays, raised their price targets on the stock after results.
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As of last close, Ross Stores shares climbed more than 27% year-to-date, compared to a 11.6% jump in the S&P 500
Reporting by Shashwat Chauhan in Bengaluru; Editing by Harikrishnan Nair
Source: Reuters