We came across a bullish thesis on Ross Stores, Inc. on The Wealth Dynasty Report’s Substack. In this article, we will summarize the bulls’ thesis on ROST. Ross Stores, Inc.’s share was trading at $190.74 as of February 6th. ROST’s trailing and forward P/E were 29.80 and 26.81 respectively according to Yahoo Finance.
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Ross Stores, Inc., together with its subsidiaries, operates off-price retail apparel and home fashion stores under the Ross Dress for Less and dd’s DISCOUNTS brands in the United States. ROST operates far beyond the typical discount retailer label, emerging as a hidden powerhouse in U.S. fashion retail through its role as a market maker in an inefficient apparel supply chain. By systematically acquiring excess inventory from distressed suppliers and overproducing brands, Ross extracts a liquidity premium that expands precisely when traditional retailers struggle, giving it a structural advantage.
Its proprietary model—tracking inventory velocity, supplier distress, and real estate efficiency—drives gross margin expansion and exceptional returns on invested capital, with ROIC exceeding 25% in dense markets. Historical crises highlight Ross’s resilience: during the 2008–2009 financial crisis and the 2020 pandemic disruption, Ross leveraged distressed inventory to grow margins while competitors faltered, rewarding disciplined investors with outsized returns. The company’s treasure-hunt model, characterized by rapid SKU turnover and careful inventory management, ensures consistent profitability and minimizes exposure to conventional retail volatility.
Even occasional missteps, such as the 2017–2018 deviation from its core strategy, reinforce the importance of its proprietary framework, which combines geographic clustering, supplier relationships, and inventory discipline to compound wealth over time. With the 2023–2024 wave of mid-tier retail bankruptcies, Ross has access to highly discounted inventory, setting up multi-quarter margin tailwinds.
Given its structural edge, disciplined execution, and ability to profit from broader retail distress, Ross Stores presents a compelling bullish opportunity. Sophisticated investors who recognize the liquidity premium inherent in its model can capture both downside protection and outsized upside, positioning ROST as a uniquely resilient and high-return investment in the evolving fashion retail landscape.
Previously, we covered a bullish thesis on Target Corporation (TGT) by LongYield in May 2025, highlighting its digital momentum, cost control, and curated value offerings that supported market share gains despite Q1 sales weakness. TGT’s stock price has appreciated by approximately 22.54% since our coverage. The Wealth Dynasty Report shares a similar bullish view but emphasizes Ross Stores’ (ROST) advantage as a fashion supply chain market maker, profiting from distressed inventory to generate outsized returns.
Ross Stores, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 58 hedge fund portfolios held ROST at the end of the third quarter which was 62 in the previous quarter. While we acknowledge the risk and potential of ROST as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ROST and that has 10,000% upside potential, check out our report about this cheapest AI stock.
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Disclosure: None.
