ROST - Ross Stores: Affordable New Apparel To Return To The Office And Socialize In

• Ross Stores is one of the largest and best-run off-price apparel and home goods retailers. Sales doubled over the last decade from strong comp store sales growth and new store openings.
• The company was hard hit by the shutdown of "non-essential" businesses in 2020 due to the COVID outbreak.
• Sales have recovered as people need new clothing to return to work and socialize in, but margins are squeezed by supply chain disruptions, wage inflation, and COVID expenses.
• It is difficult to tell when the cost inflation and margin squeeze will moderate.
• Ross has the advantages of scale, efficiency, highly sophisticated buying operation, and wider distribution that will enable it to capture share at the expense of smaller mom & pop competitors with thinner margins that are more susceptible to going out of business if costs continue to rise.

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