Ross, Take-Two, Copart, Zoom, Workday, Estée Lauder, Deckers
Ross Stores' ROST first-quarter results included 21% sales growth and adjusted EPS of $2.02, up 38%. Operating margin expanded 120 basis points to 13.
Is this your brand on Milled? Claim it.
Stock Analyst NotesMay 22, 2026
Ross Stores' ROST first-quarter results included 21% sales growth and adjusted EPS of $2.02, up 38%. Operating margin expanded 120 basis points to 13.4%, driven by merchandise margin gains, occupancy leverage, and lower distribution costs, but partly offset by higher compensation expense. Customer count rose by a double-digit rate on a comparable-store basis, with strength across income levels, age groups, categories, and regions. We view this as evidence that marketing, stronger assortments, and improved in-store execution are widening Ross' appeal.
Take-Two TTWO closed a very strong fiscal 2026 with an excellent fourth quarter, but within management's guidance. The fiscal 2027 outlook is materially below the FactSet consensus, but the stock rallied sharply after the November release date of Grand Theft Auto VI was confirmed. Management's fiscal 2027 outlook calls for only 20% sales growth and flat recurrent spending, which is disappointing, considering the magnitude of the release. The outlook is dragged down by expectations of lower mobile sales due to maturing titles, after mobile had a stellar 2026, growing sales 15%.
ADVERTISEMENT 
Copart's CPRT fiscal third quarter saw diluted EPS up 2.4% year over year to $0.43 on just over 2% revenue growth in each of the consignment and vehicle sales segments. International volume bucked the 4.2% US decline and grew 5.9%, including noninsurance international volume up 11.2%. Strength in the UK, Canada, and Germany drove the increase, while growth in Central Europe, Africa, and Central America countered Middle East struggles.
Zoom's ZM fiscal 2027 first-quarter revenue and non-GAAP operating margin both topped the high end of guidance. Revenue was $1.239 billion, while non-GAAP operating margin was 41.1%. The firm’s second-quarter outlook was also ahead of our expectations. Zoom Phone grew by the midteens, well above peers, while Zoom Customer Experience accelerated with high-double-digit growth driven by paid AI in large deals.
Workday WDAY maintained stable growth momentum in its fiscal 2027 first quarter. Total revenue rose 14% year over year to $2.5 billion, and non-GAAP operating margin expanded 160 basis points to an all-time high of 31.8%. Twelve-month subscription backlog growth of 16% was also healthy. Workday's annual agentic AI recurring revenue crossed $500 million, compared with $400 million last quarter. New annual contract value for agentic AI products grew over 200% year over year.
Estée Lauder EL confirmed that it has terminated merger talks with Puig. Instead, it plans to stay the course: investing in its brands, rightsizing its distribution footprint, and extracting inefficiencies. While the deal stood to strengthen Estée's position in fragrance, we were skeptical, given the potential deal's size and the distraction it could pose for management amid its ongoing turnaround. Thus, we see this decision as sound.
Deckers' DECK fiscal fourth-quarter sales grew 10% on increases of 15% for Hoka and 9% for Ugg. Gross margin rose 90 basis points to 57.6% despite negative tariff impacts, but operating margin declined 3 percentage points on higher marketing spending. Hoka continues to be one of the fastest-growing athletic footwear brands, while Ugg's reach is expanding. Deckers' 10% total sales growth exceeded our 6% forecast as Ugg's growth came in well above our 1% estimate.
Take the guesswork out of finding stocks that can deliver for the long term
Stay connected:
|
Unsubscribe from this newsletter. Or update your email preferences.
© 2026 Morningstar, Inc. All Rights Reserved. 22 W. Washington St. Chicago, IL 60602
