Episode Details

Ross Stores (ROST) Q2 FY2026 — Ross Stores reported Q2 FY2026 on an 8-K accepted 16:11:01 ET on Thursday August 20, so Friday August 21 is the reaction session and it is also the last settled one. Shares closed USD239.04 against USD228.99, UP 4.39 pct, on 6,354,194 shares, 2.65x the 20-session median. The OPEN was USD243.85, up 6.49 pct - and USD243.86 was the high of the entire day, one cent above the opening print. By the 10:25 bar the price was USD234.49, with 63 pct of the gap gone. Ross Stores (NASDAQ: ROST) is the largest off-price apparel and home fashion chain in the United States, selling other retailers' excess brand-name merchandise at 20 to 60 pct off. Founded 1957, headquartered in Dublin, California, about 111,000 employees. Two banners: 1,952 Ross Dress for Less stores in 44 states plus 376 dd's DISCOUNTS. Jim Conroy is CEO. The fiscal year ends in late January. THE CALL: AVOID (3/5, MODERATE - A REAL QUARTER PRICED AS IF ALL OF IT RECURS) — base-case value ~$218.19 vs ~$239.04 today. KEY METRICS: - Q2 FY2026 sales USD6.265B against USD5.529B, up 13.3 pct, on comparable store sales up 10 pct driven by traffic, lapping plus 2 pct. Operating profit USD1.104B, margin 17.6 pct from 11.5. Net income USD851M. Diluted EPS USD2.66 on 319,450,000 shares against USD1.56. Ross publishes ONE earnings figure - no adjusted series and no reconciliation table anywhere in the release. - THE SPINE: operating profit includes approximately USD253M of IEEPA tariff refunds - 405 of the 610 basis points of margin gain, and about USD0.60 a share. Against the company's OWN guidance midpoint of USD1.89 the beat is USD0.77, so the refund is 77.9 pct of it and operations added USD0.17. Ex-refund the quarter earned USD2.06 on a margin up 205 bps against a plan of 130 to 150. - The full-year guide went USD7.02-7.36 (3 March) to USD7.50-7.74 (21 May) to USD8.61-8.77 (20 August). The May-to-August raise of USD1.07 is USD0.60 refund (56.1 pct), USD0.17 of Q2 operating beat and USD0.30 of genuine second-half increase. Ex-refund the year is USD8.01-8.17, up 22.4 pct on USD6.61 rather than 31.5 pct. Q3 guided USD1.75-1.83, Q4 USD2.17-2.26. What to watch: The Q2 FY2026 8-K accepted 16:11:01 ET on 20 August 2026 and its Exhibit 99.1, read against the outlook paragraphs of the 8-Ks of 3 March and 21 May 2026. Sales USD6.265B and diluted EPS USD2.66 against a company guide of USD1.85-1.93 and a vendor bar of USD1.95. Full-year guidance went to USD8.61-8.77. The Q2 Form 10-Q had NOT been filed as of 21 August. Also on YouTube: @ChargedAlpha DISCLAIMER: For informational and educational purposes only. Not financial advice. Do your own research before any investment decision.