July 06, 2025 a 07:46 am
ROST: Dividend Analysis - Ross Stores, Inc.
Ross Stores, Inc. shows a moderate dividend yield with a long-standing history of consistent dividends over 32 years without recent cuts or suspensions. The company has demonstrated manageable payout ratios and a steady growth in dividends, suggesting robust financial health and shareholder returns.
Overview 📊
Ross Stores, Inc. operates within the consumer discretionary sector, characterized by steady yet modest dividend yields. Below, the specifics of the company’s dividend profile are detailed, showcasing its commitment to returning value to its shareholders.
| Metric | Value |
|---|---|
| Sector | Consumer Discretionary |
| Dividend Yield | 1.10 % |
| Current Dividend per Share | 1.49 USD |
| Dividend History | 32 years |
| Last Cut or Suspension | None |
Dividend History 🗣️
The longevity of Ross Stores' dividend payments exemplifies its commitment to sharing profitability with stakeholders. A stable and growing dividend history is pivotal for investor confidence, particularly for income-focused portfolios.
| Year | Dividend per Share (USD) |
|---|---|
| 2025 | 0.810 |
| 2024 | 1.470 |
| 2023 | 1.340 |
| 2022 | 1.240 |
| 2021 | 1.140 |
Dividend Growth 📈
Analyzing dividend growth offers insights into the company's earnings robustness and strategic financial planning. Consistent growth signals resilience and adaptability to market conditions.
| Time | Growth |
|---|---|
| 3 years | 8.84 % |
| 5 years | 7.58 % |
The average dividend growth is 7.58 % over 5 years. This shows moderate but steady dividend growth.
Payout Ratio ✅
Payout ratios provide insight into the sustainability of dividends and the proportion of earnings or cash flow returned to shareholders. Low ratios imply a conservative dividend policy with potential room for increases.
| Key Figure | Ratio |
|---|---|
| EPS-based | 23.21 % |
| Free Cash Flow-based | 30.28 % |
With EPS and FCF payout ratios at 23.21 % and 30.28 % respectively, Ross Stores maintains a balanced distribution approach, ensuring sufficient reinvestment into the company while rewarding shareholders.
Cashflow & Capital Efficiency ⚙️
The efficiency of cash flow handling and capital deployment highlights management effectiveness. Indicators such as free cash flow yield and operational ratios are pivotal for understanding liquidity and operational stability.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 3.31 % | 3.64 % | 2.52 % |
| Earnings Yield | 4.23 % | 3.89 % | 3.68 % |
| CAPEX to Operating Cash Flow | 32.00 % | 30.34 % | 38.72 % |
| Stock-based Compensation to Revenue | 0.74 % | 0.71 % | 0.65 % |
| Free Cash Flow / Operating Cash Flow Ratio | 69.45 % | 69.66 % | 61.28 % |
This illustrates Ross Stores' competent cash flow management, indicative of strong operational efficiency and a firm basis for potential future growth investments.
Balance Sheet & Leverage Analysis 📉
Understanding leverage alongside key liquidity ratios elucidates financial robustness, borrowing capacity, and short-term financial security.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 1.03 | 1.18 | 1.33 |
| Debt-to-Assets | 38.12 % | 40.19 % | 42.53 % |
| Debt-to-Capital | 50.77 % | 54.13 % | 57.09 % |
| Net Debt to EBITDA | 0.29 | 0.30 | 0.48 |
| Current Ratio | 1.62 | 1.77 | 1.89 |
| Quick Ratio | 1.09 | 1.24 | 1.34 |
| Financial Leverage | 2.71 | 2.94 | 3.13 |
Ross Stores demonstrates optimal leverage management with improving current and quick ratios, reflecting sound liquidity and prudent debt usage.
Fundamental Strength & Profitability 🔍
Examining profitability ratios such as ROE and margins can articulate operational efficiency and bottom-line performance.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 37.95 % | 38.48 % | 35.26 % |
| Return on Assets | 14.03 % | 13.11 % | 11.27 % |
| Margins: Net | 9.90 % | 9.20 % | 8.09 % |
| EBIT | 13.35 % | 12.49 % | 11.06 % |
| EBITDA | 15.46 % | 14.55 % | 12.76 % |
| Gross | 27.78 % | 27.36 % | 25.40 % |
| R&D to Revenue | 0 % | 0 % | 0 % |
Profitability indicators reaffirm Ross Stores’ robust financial health, evident through strong ROE and improving margins, delivering sustained shareholder value.
Price Development 💹
Dividend Scoring System
| Criteria | Score | Bar |
|---|---|---|
| Dividend yield | 3 | |
| Dividend Stability | 4 | |
| Dividend growth | 3 | |
| Payout ratio | 4 | |
| Financial stability | 4 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 4 |
Overall Score: 31/40
Rating ✅
Ross Stores, Inc. continues to provide a reliable dividend yield with consistent growth and stability, making it an attractive option for dividend-focused investors. Its solid financials, effective management strategies, and commitment to shareholder value delivery are commendable.