NEW YORK (AP) -- Shares of Ross Stores Inc. fell sharply before Friday's opening bell after the discount retailer said it expects tough competition and discounting this holiday shopping season.
In premarket trading, Ross shares fell $6.01, or 7.5 percent, to $74.25 about 90 minutes before the market opening.
This year's holiday shopping period is shaping up to be exceptionally competitive, with more stores opening on Thanksgiving and ramping up discounts to grab shoppers. There's also a shorter window of time between Thanksgiving and Christmas than usual.
Ross projected a fiscal fourth-quarter profit of between 97 cents and $1.01 per share, below analysts' expectations of $1.08 per share. For the year, Ross forecast earnings between $3.83 and $3.87 per share. Analysts polled by FactSet expected $3.94 per share.
The company also released fiscal third-quarter results roughly in line with Wall Street predictions.
Sterne Agee analyst Ike Boruchow backed his "Buy" rating for Ross, saying that any drop in its share price should be looked at as an opportunity to pick up shares at a discount. He noted that the company is doing a good job at managing its store inventories and selling its products at full price.
Jefferies' Randal Konik reaffirmed his "Hold" rating, but boosted his price target by $6 to $70. He said that while he likes Ross' "resilient" business model and potential for long-term growth, he thinks the company's shares have hit their fair price.