Ross Stores stock gains UBS backing for productivity-led growth
Published on 11/05/2026 at 14:54 | Editorial responsibility: Rafael Müller, Editor-in-Chief AD HOC NEWSWhat Investors Should Watch
- UBS sees Ross Stores closing part of its store-productivity gap with TJ Maxx through merchandising, operations and marketing.
- Chief Executive James Conroy's strategy faces its next major test when Ross Stores reports third-quarter results.
- Higher investment may support traffic and comparable sales, but it could pressure margins before the benefits emerge.
UBS has strengthened its view on Ross Stores, arguing that the US off-price retailer can lift comparable-store sales by improving productivity under Chief Executive James Conroy. The bank upgraded the shares from Neutral to Buy on October 26 and raised its price target from 239 US dollars to 315 US dollars, according to CNBC.
UBS Sees Room To Catch Up
The investment case centers on the gap between Ross Stores and TJ Maxx. UBS said both retailers had broadly similar store productivity in 2017, but productivity increased 44 percent at TJ Maxx by the end of 2025, compared with 24 percent at Ross Stores.
UBS analyst Jay Sole identified three operating levers: better merchandise and brand selection, stronger in-store execution and more effective marketing. The bank expects those changes to help sustain recent same-store sales momentum beyond 2026 and support comparable growth in fiscal 2027 and later years.
Marketing offers a visible area for potential investment. Ross Stores spent 0.4 percent of sales on marketing in calendar 2025, compared with 1.1 percent at TJX, according to the UBS analysis reported by CNBC. Increasing spending could improve customer traffic, but the added cost would need to translate into higher sales and earnings to support margins.
Growth Forecast Comes With Execution Risk
UBS forecasts revenue growth of 8.5 percent annually over the next two years, 260 basis points above the consensus estimate cited by the bank. Its fiscal 2028 earnings-per-share estimate stands 9 percent above consensus, while its model implies annual EPS growth of about 15 percent.
That outlook depends on Ross Stores narrowing the productivity gap without losing control of expenses. Stronger merchandising and store operations could raise sales per location, while higher marketing and operating spending could weigh on profitability before the gains become visible.
The real-time quote of Ross Stores stock showed 221.08 euros on Lang & Schwarz at 14:44 CET on Thursday, November 5, 2026.
Ross Stores Stock Facts
- Company: Ross Stores, Inc.
- ISIN: US7782961038
- Ticker: ROST
- Home exchange: Nasdaq
- Lang & Schwarz quote: 221.08 euros at 14:44 CET on November 5, 2026
- WKN: 870053
US retail shares remain sensitive to consumer spending, inflation and expectations for the holiday season. Investors can follow broader developments through current S&P 500 market coverage.
Ross Stores is expected to report its third-quarter fiscal 2026 results on November 19, with comparable-store sales, traffic, merchandise margins and marketing investment likely to be key indicators for the UBS thesis. More news and analyses on Ross Stores stock.
