Ross Stores is gaining traction under CEO James Conroy, according to UBS, which upgraded the stock to ‘buy’ and raised its price target to $315. The investment bank believes strategic changes are helping Ross close the productivity gap with rival TJ Maxx.
UBS forecasts that Ross’s revenue could grow at an 8.5% compound annual growth rate over the next two years, exceeding consensus estimates, driven by improving in-store operations and merchandising.
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Ross Stores is showing signs of significant improvement under the leadership of its new CEO, James Conroy, prompting an upgrade from neutral to buy by UBS. The investment bank also substantially increased its price target for the discount retailer's stock to $315 from $239, indicating a potential 37% upside from its previous closing price.
Analyst Jay Sole at UBS expressed optimism about Ross Stores' (ROST) ability to sustain its recent same-store sales growth momentum beyond the current year. "The answer is yes," Sole stated in a note to clients on Monday.
Historically, Ross Stores has trailed its main competitor, TJ Maxx, in terms of productivity. However, UBS believes that strategic changes in merchandising, marketing efforts, and enhanced in-store operations are enabling Ross to narrow this gap. Conroy joined Ross Stores in February 2025, and by the end of that year, the company saw a 24% increase in productivity, while its competitor's productivity grew by 44%.
"The market doesn't appreciate how much ROST closing this gap will drive [same-store sales] growth in [fiscal year 2027] and beyond," Sole remarked. UBS projects that as productivity continues to improve, Ross Stores could achieve a compound annual growth rate of approximately 8.5% in revenue over the next two years. This forecast is about 260 basis points higher than the Street's consensus estimate for Ross' revenue.
The analyst sentiment surrounding Ross Stores aligns with broader market views. Out of 21 analysts covering the stock, 14 recommend a buy or strong buy, with the remaining seven holding a neutral rating, according to LSEG data. Despite this positive outlook, the company's shares have experienced a 4% decline over the past three months.
