Ross Stores stock gets UBS backing for productivity plan

UBS upgraded Ross Stores from Neutral to Buy on October 26 and raised its price target from 239 to 315 US dollars. The call puts CEO James Conroy's productivity plan at the center of the investment case, with stronger merchandising, store operations and marketing expected to support future comparable-store sales.

CNBC reported that UBS analyst Jay Sole sees recent same-store sales momentum continuing beyond the current year. The bank believes Ross Stores can improve its economics by narrowing the productivity gap with TJ Maxx, its larger off-price retail rival.

Closing the TJ Maxx gap

Ross Stores and TJ Maxx had broadly similar store productivity in 2017, according to UBS. By the end of 2025, Ross Stores' productivity had risen 24 percent, while TJ Maxx had recorded a 44 percent increase. UBS argues that a narrower gap could lift comparable-store sales in fiscal 2027 and beyond.

Three operating levers underpin the thesis. Better merchandise and brand selection could improve the customer offer, tighter in-store execution could raise sales productivity, and more effective marketing could increase traffic. Conroy joined Ross Stores in February 2025, giving the strategy a new leadership focus.

UBS forecasts Ross Stores revenue to grow at a compound annual rate of 8.5 percent over the next two years. That is 260 basis points above the Street consensus cited by the bank. The forecast also assumes that stronger sales will lead to upward earnings revisions, although the plan requires Ross Stores to invest before the benefits are fully visible.

Investment trade-offs remain

The productivity opportunity comes with execution risk. Higher marketing and operating spending can weigh on margins before stronger traffic and sales offset the cost. Investors therefore need to track whether improved merchandise, store operations and advertising produce sustained comparable-store sales growth rather than only higher expenses.

The real-time quote of Ross Stores stock traded at 211.85 euros on Lang & Schwarz at 14:04 CET on Wednesday, November 4, 2026.

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UBS's outlook leaves execution as the next test for the retailer. Investors will focus on comparable-store sales, store productivity and the balance between marketing investment and earnings leverage. More news and analyses on Ross Stores stock.