Shannon Saccocia, CIO, Boston Private Ross Stores Inc. ROST-Q BUY Nov 17, 2023

(A Top Pick May 05/20, Up 33%) He has some concerns about retail but they sell the excess inventory of name brands and provide a treasure hunt experience. They are extremely well run. They re-initiated their dividend. He got stopped out but has not bought back yet.

Ross and TJX benefit from oversupply in retail, and we've seen oversupply in many retail names.

The forward outlook isn't super, but the street presumed that consumer spending will decline, but reports from this sector don't show that. She may use this as a source of funds.

The stock has made a great move, but be honest--it was trading off free-money multiples at 26x earnings.

She also owns American Eagle Outfitters and Foot Locker in the retail space. Ross is actually up only 1% year to date, but up 40% in the past month. AEO is -40% YTD, up 50% in the last month, and Foot Locker is 15% YTD and 15% past month. The theme for all these--and why should bought them--was that the street punished these stocks so severely, expecting them to lay down and DIE and customers will never spend money again. Well, American consumers are very resilient and continue to spend. Ross is actually not going that great: margin contraction, and 5% lower same-store sales, BUT those were so much better than expected. Yes, you should be in discount retailing, but this share has already shot up this month. The low-hanging fruit, the time to buy, was last summer--and people missed it. Forget 40% moves, but there will be some movement. AEO cut their dividend last quarter, so she exited. She's holding onto Ross and Foot Locker, because there's still upside. Ross is expensive at 20x earnings, so use it as a source of funds. Foot Locker remains cheap and still buying back shares. Do your homework in the retail space. Problem is that all the retail ships have risen in recent weeks and we won't see those gains again.