Ross Stores Soars 7.7% on Earnings Surge and Strategic Momentum

Summary
• Ross Stores (ROST) surges 7.7% intraday, hitting a 52-week high of $173.79.
• Q3 earnings of $1.58/share beat estimates by $0.17, with sales up 10% to $5.6B.
• Guidance raised to $6.38–$6.46/share for FY2025, signaling strong holiday season optimism.

Ross Stores’ stock is in a tailwind after a blockbuster Q3 earnings report, with shares rallying to a record high. The retailer’s 7% earnings beat, 10% sales growth, and upgraded guidance have ignited investor enthusiasm. With a 52-week high reached and a 7.7% intraday gain, the stock’s momentum is fueled by robust consumer demand and strategic cost controls.

Earnings Beat and Guidance Hike Drive ROST's Intraday Rally
Ross Stores’ 7.7% surge stems from a combination of outperforming Q3 results and optimistic guidance. The company reported $1.58/share in earnings, exceeding estimates by $0.17, while sales grew 10% to $5.6 billion. Management raised FY2025 EPS guidance to $6.38–$6.46, reflecting confidence in holiday sales and margin stability. CEO Jim Conroy highlighted strong back-to-school performance, effective tariff cost mitigation, and a $262 million share repurchase program as key drivers. The stock’s rally to a 52-week high aligns with its 7% comparable store sales growth and 11.6% operating margin, outpacing sector peers.

Department Stores Sector Gains Momentum as ROST Outperforms
The department stores sector, grappling with mall closures and shifting consumer habits, saw Ross Stores outperform with a 7.7% gain. While peers like Macy’s and JCPenney face store closures and declining foot traffic, ROST’s 10% sales growth and 7% comp store sales acceleration highlight its off-price retail model’s resilience. Sector leader TJX (TJX) rose 2.57% on the day, but ROST’s earnings beat and guidance hike positioned it as a standout within a struggling sector.

Options and Technicals Signal High Conviction in ROST’s Rally
• 200-day MA: 142.59 (well below current price)
• RSI: 56.34 (neutral to overbought)
• MACD: 1.48 (bullish divergence from signal line 1.97)
• Bollinger Bands: Price at 172.89 (above upper band 163.77)
• K-line pattern: Short-term bearish, long-term bullish

Ross Stores’ technicals and options chain suggest a continuation of its rally. The stock is trading above its 200-day MA and Bollinger Bands, with RSI near overbought territory. Two options stand out for aggressive bulls:

• ROST20251128C172.5 (Call, $172.5 strike, Nov 28 expiry):
- IV: 21.27% (moderate)
- Delta: 0.565 (moderate sensitivity)
- Theta: -0.501 (high time decay)
- Gamma: 0.072 (high sensitivity to price moves)
- Turnover: 13,904 (liquid)
- Leverage: 66.61% (high potential return)
- Payoff at 5% upside ($181.53): $9.03/share. This call offers a balance of liquidity and leverage, ideal for capitalizing on a sustained rally.

• ROST20251128C170 (Call, $170 strike, Nov 28 expiry):
- IV: 16.06% (low)
- Delta: 0.795 (high sensitivity)
- Theta: -0.588 (high time decay)
- Gamma: 0.069 (moderate sensitivity)
- Turnover: 10,866 (liquid)
- Leverage: 45.70% (moderate return)
- Payoff at 5% upside ($181.53): $11.53/share. This in-the-money call provides a safer entry with lower IV, suitable for a conservative bullish bet.

Aggressive bulls should consider ROST20251128C172.5 into a break above $173.79 (52-week high).

Backtest Ross Stores Stock Performance
Based on the event-study backtest, only TWO trading days since 2022 met the “≥ 8 % single-day surge” condition for Ross Stores (ROST). An overview of the reaction pattern:• Quick follow-through: average +5.2 % by day 2 and +9.1 % by day 3, both statistically significant. • Gains fade: by day 10 the excess return moderates to +5.7 %; from day 13 onward significance disappears and the edge erodes. • 30-day picture: cumulative event return +3.4 % vs. S&P 500 +2.0 % (not statistically significant).Trading implication Historically, the optimal holding window after an 8 % up-day was 2–5 sessions where win-rate hit 100 % and abnormal return peaked. Beyond two weeks the advantage vanished.Event coverage caveat With only two qualifying events in the 2022-2025 sample, statistical power is limited; conclusions should be viewed as directional rather than definitive.I have attached an interactive event-backtest dashboard so you can examine each metric in detail.Feel free to explore the plots, cumulative P&L curve, and daily statistics, or let me know if you’d like to adjust the threshold, add stop-loss / take-profit layers, or test other names.

Bullish Momentum Unlikely to Subside—Position for ROST's Holiday Run
Ross Stores’ 7.7% rally is underpinned by strong earnings, margin resilience, and upgraded guidance, positioning it as a holiday season winner. With technicals favoring a continuation above $173.79 and options like ROST20251128C172.5 offering high leverage, investors should watch for a breakout. Sector leader TJX (TJX) rose 2.57%, but ROST’s strategic execution and tariff cost mitigation make it a standout. Act now: Buy ROST20251128C172.5 if $173.79 holds, or short-term bulls can target $180 with a stop below $167.5.