Goldman Sachs Loves Retail Discounters Like Ross Stores — But Not This One Giant Retailer

Zinger Key Points
  • Goldman Sachs initiated coverage of Burlington Stores with a Buy rating and $183 price target.
  • “We see strategic merit in BURL’s strategic transformation," the analyst says.
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While growth in the apparel sector is likely to slow, with rising inventory levels, inflation and supply chain issues, the off-price sector remains “defensively positioned,” according to Goldman Sachs.

The American Retail Analyst: Brooke Roach said off-price retail companies could benefit from consumers looking for lower price branded products against the current macro backdrop.

Goldman Sachs On Ross Stores

Roach initiated coverage of Ross Stores, Inc. ROST with a Buy rating and $102 price target.

Ross Stores is poised to gain market share “as it increasingly benefits from trade-down among its core lower-income consumer following initial demand shocks,” the analyst said. The company also has “meaningful share opportunity through store fleet expansion as it extends its geographic footprint across the U.S.,” she added.

Check out other analyst stock ratings.

Goldman Sachs On Burlington Stores

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Roach initiated coverage of Burlington Stores Inc BURL with a Buy rating and $183 price target.

“We see strategic merit in BURL’s strategic transformation, driven by a better-resourced buying environment, improvements to the store fleet (including small-store rollout), and evidenced by signs of improving brand momentum among consumers,” the analyst said.

Goldman Sachs On TJX Companies

The analyst started coverage of TJX Companies Inc TJX with a Neutral rating and $70 price target.

Although TJX Companies has a “strong consumer positioning” and could continue to “deliver stronger comps vs. peers,” the positives are “well-understood by investors (and reflected in a premium valuation),” Roach said.

ROST, BURL, TJX Price Action: Shares of Ross Stores, Burlington Stores, and TJX Companies were trading down by around 2% at the time of publication Tuesday.

Photo via Shutterstock. 

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