Maxim Group Starts Ross Stores, Inc. (ROST) at Buy

Maxim Group initiates coverage on Ross Stores, Inc. (NASDAQ: ROST) with a Buy. PT $75.00.

Maxim analyst Rick Snyder notes, "We arrive at our $75.00 price target by applying an 8.0x EV/EBITDA multiple to our 2015 EBITDA estimate of 1997.0. Although we typically apply a 7.0x EV/EBITDA multiple to department stores, we believe that Ross Stores deserves a premium for the following reasons: 1) the outsized growth in the off-price channel in which the company operates; 2) the consistent gains in comps; and 3) growth in sales per square foot, expanding square footage at a CAGR of 7.0% since 2004, including expansion into new markets 4) We believe that Ross could eventually expand to 2,500 stores from its current 1,227 and have modeled annual square footage growth in the mid single digits."

For an analyst ratings summary and ratings history on Ross Stores, Inc. click here. For more ratings news on Ross Stores, Inc. click here.

Shares of Ross Stores, Inc. closed at $63.80 yesterday.

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