PLEASANTON, Calif. (AP) -- Discount-store operator Ross Stores Inc. said Thursday that a key retail figure rose 7 percent during April, helped by consumer demand for its low-price clothing and accessories.
Ross and other discount stores such as TJX Cos.' Marshall's and T.J. Maxx have captured consumer demand for low-priced goods. Results beat expectations and the company raised its net income guidance for the quarter.
Analysts expected a 5.8 percent increase in April, according to a Thomson Reuters poll.
Total revenue for the four weeks ended May 4 rose 12 percent to $778 million, from $697 million last year.
Stifel Nicolaus analyst Richard Jaffe said in a research report that "value-focused customers continued to respond favorably to the company's compelling bargains." But he kept his "Hold" rating, saying results are already reflected it the stock's value, which is up 22 percent in the year to date.
For the quarter ended May 4, Ross Stores said revenue in stores open at least one year rose 3 percent, while total revenue rose 6 percent to $2.54 billion. Analysts expected $2.53 billion, according to FactSet.
Revenue in stores open at least one year is considered a key gauge of a retailer's financial health because it excludes results from stores that open or close during the year.
The company now expects first-quarter net income to be $1.06 to $1.07 per share, up from prior guidance of $1 to $1.04 per share. Analysts expect $1.05 per share.
Ross plans to report first quarter results on May 23. It operates more than 1,100 stores.
Shares of the Pleasanton, Calif., rose 1 cent to $66.14 in morning trading.