ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Ross Stores's annualized return on invested capital (ROIC %) for the quarter that ended in Apr. 2026 was 27.72%.
As of today (2026-06-27), Ross Stores's WACC % is 8.19%. Ross Stores's ROIC % is 24.86% (calculated using TTM income statement data).
Ross Stores generates higher returns on investment than it costs the company to raise the capital needed for that investment. It is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases.
Ross Stores (MEX:ROST) ROIC % Explanation
ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. The reason book values of debt and equity are used is because the book values are the capital the company received when issuing the debt or receiving the equity investments.
There are four key components to this definition. The first is the use of operating income or EBIT rather than net income in the numerator. The second is the tax adjustment to this operating income or EBIT, computed as a hypothetical tax based on an effective or marginal tax rate. The third is the use of book values for invested capital, rather than market values. The final is the timing difference; the capital invested is from the end of the prior year whereas the operating income or EBIT is the current year's number.
Why is ROIC % important?
Because it costs money to raise capital. A firm that generates higher returns on investment than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, Ross Stores's WACC % is 8.19%. Ross Stores's ROIC % is 24.86% (calculated using TTM income statement data).
Ross Stores generates higher returns on investment than it costs the company to raise the capital needed for that investment. It is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases.
Be Aware
Like ROE % and ROA %, ROIC % is calculated with only 12 months of data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Ross Stores ROIC % Related Terms
Ross Stores ROIC % Historical Data
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The historical data trend for Ross Stores's ROIC % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Apparel Retail subindustry, Ross Stores's ROIC %, along with its competitors' market caps and ROIC % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Ross Stores ROIC % vs Retail - Cyclical Industry
For the Retail - Cyclical industry and Consumer Cyclical sector, Ross Stores's ROIC % distribution charts can be found below:
* The bar in red indicates where Ross Stores's ROIC % falls into.
Note:
The Operating Income data used here is four times the quarterly (Apr. 2026) data.
The tax rate is limited to between 0% and 100%.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Ross Stores (MEX:ROST) has a ROIC % of 27.72% as of Apr. 2026. Return on invested capital is the ratio of current-period net income to average two-period invested capital. View historical data on Ross Stores and its competitors.
Is Ross Stores' ROIC % too high?
Ross Stores' current ROIC % is 27.72%. The Retail - Cyclical industry median ROIC % is 4.37. Ross Stores' value of 27.72% is 534.3% above this industry median. Overall, Ross Stores has a GF Score™ of 79/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Ross Stores' ROIC % compare to BURL and LULU?
Ross Stores' ROIC % of 27.72% can be compared against companies in the Retail - Cyclical industry. The industry median ROIC % is 4.37. Ross Stores' value of 27.72% is 534.3% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROIC % for a Retail - Cyclical company?
The median ROIC % among Retail - Cyclical companies is 4.37, based on 1,113 companies in the industry. Companies in the top quartile (top 25%) have a ROIC % significantly above this median, while those in the bottom quartile fall well below. However, ROIC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Ross Stores's current ROIC % of 27.72% is 534.3% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROIC % mean?
A high ROIC % can signal that a stock is expensive relative to its fundamentals. Return on invested capital is the ratio of current-period net income to average two-period invested capital. View historical data on Ross Stores and its competitors. For the Retail - Cyclical industry, the median ROIC % is 4.37 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Ross Stores's current ROIC % is 27.72%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Ross Stores stock overvalued right now?
Based on GuruFocus' analysis, Ross Stores (MEX:ROST) is currently considered Modestly Overvalued. The stock's GF Value™ is MXN3,342.67, compared to a current price of MXN4,100.00 — trading 22.7% above its estimated fair value. The current ROIC % is 27.72% and 534.3% above the Retail - Cyclical industry median of 4.37. Ross Stores' overall GF Score™ is 79/100. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROIC % calculated?
ROIC % is calculated from a company's financial statements. For Ross Stores (MEX:ROST), the current ROIC % is 27.72% as of Apr. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Ross Stores (MEX:ROST) Overvalued in 2026?
Based on GuruFocus' analysis, Ross Stores stock appears to be overvalued.
The current stock price of MXN4,100.00 is trading 22.7% above its estimated GF Value™ of MXN3,342.67.
GuruFocus considers Ross Stores to be Modestly Overvalued.
Key valuation signals for MEX:ROST:
ROIC %: 27.72%
GF Value™: MXN3,342.67 vs. price of MXN4,100.00 (22.7% above fair value)
Industry Position: 534.3% above the Retail - Cyclical median
No single metric tells the full story. See the MEX:ROST stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Ross Stores, founded in 1982, is a US-focused off-price apparel and home fashion retailer operating more than 2,100 stores across 43 states, primarily under the Ross Dress for Less banner, with a smaller footprint through dd's Discounts. In fiscal 2025, the company generated over $22 billion in sales. Ross offers branded apparel, footwear, accessories, and home goods at a 20%-60% discount to department and specialty store prices, sourcing closeouts and excess inventory from vendors worldwide.
79GF Score
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