For Immediate Release
Chicago, IL – June 25, 2026 – Zacks Equity Research shares Ross Stores ROST as the Bull of the Day and Lennar Corp. LEN as the Bear of the Day. In addition, Zacks Equity Research provides analysis on NVIDIA Corporation’s NVDA and Seagate Technology Holdings plc STX
Here is a synopsis of all five stocks:
Bull of the Day:
Ross Stores, a Zacks Rank #1 (Strong Buy), has been one of the standout performers in retail this year, and for good reason.
The nation’s largest off-price apparel and home-fashion retailer is firing on all cylinders, posting the strongest comparable-sales quarter in its four-decade history while value-seeking consumers continue to flock to its treasure-hunt shopping model. The stock’s recent upgrade reflects a powerful upward trend in earnings estimates — one of the most reliable forces driving share prices higher.
Shares have broken out to new highs on strong volume and continue to display impressive relative strength, having climbed roughly 27% year-to-date and outpacing the broader Retail and Wholesale sector. This is precisely the kind of price action that tends to accompany a stock with improving fundamentals and rising estimates.
Ross Stores is part of the Zacks Retail – Discount Stores industry group, which currently ranks in the top 11% out of approximately 250 Zacks Ranked Industries. Because it is ranked in the top half of all Zacks Ranked Industries, we expect this group to outperform the market over the next 3 to 6 months, just as it has so far this year.
The industry’s strength has been driven by a positive earnings outlook for its constituent companies in aggregate, a powerful foundation that should lead to higher prices in the future.
Historical research studies suggest that approximately half of a stock’s price appreciation is due to its industry grouping. In fact, the top 50% of Zacks Ranked Industries outperforms the bottom 50% by a factor of more than 2 to 1.
It’s no secret that investing in stocks that are part of leading industry groups can give us a leg up relative to the market. By focusing on leading stocks within the top 50% of Zacks Ranked Industries, we can dramatically improve our stock-picking success.
Company Description
Ross Stores operates the largest off-price retail apparel and home-fashion business in the United States, selling first-quality, in-season, name-brand and designer merchandise at meaningful discounts to department and specialty stores.
The company runs two banners — Ross Dress for Less, its flagship chain of roughly 2,300 locations, and dd’s DISCOUNTS, which targets more moderate-income households. Its opportunistic buying model, which capitalizes on manufacturer overruns and packaway inventory, allows Ross to deliver the bargains that keep customers coming back.
The value proposition has rarely been more relevant. As shoppers across income levels hunt for ways to stretch their budgets, Ross’s low-price, no-frills format has captured a broadening customer base. Under CEO Jim Conroy, the company has sharpened its marketing, merchandising, and in-store experience, and it continues to expand aggressively — opening 17 new stores in the most recent quarter, with roughly 110 openings planned for fiscal 2026 and a long-term runway toward 2,900 Ross and 700 dd’s DISCOUNTS locations from today’s base.
Earnings Trends and Future Estimates
Ross most recently delivered a blowout first-quarter report. Adjusted earnings of $2.02 per share topped the Zacks Consensus Estimate of $1.70 by 18.9% and surged 37% from the prior-year period, while revenues of $6.01 billion jumped 21% year over year.
The headline figure was a 17% increase in comparable-store sales — the strongest same-store performance in the company’s 40-year history — accompanied by 120 basis points of operating-margin expansion to 13.4% on better merchandise margins and tighter cost control. It was a clean beat across every line that matters.
Crucially, management responded by raising its full-year outlook, now guiding to comparable-sales growth of 6-7% and earnings per share of $7.50 to $7.74, representing growth of roughly 13-17% over the prior year’s $6.61.
Analysts have followed suit: the Zacks Consensus Estimate for the current fiscal year has climbed about 5.8% over the past 60 days, now sitting near $7.74. That upward revision activity placed Ross in the top 5% of all Zacks-covered stocks on estimate revisions — the engine behind its Strong Buy rating. The company also returned cash aggressively, repurchasing $318.7 million of stock and paying down $500 million in senior notes during the quarter.
Let’s Get Technical
Ross Stores has been in a well-defined uptrend, and the latest earnings reaction only reinforced it. This is the kind of stock we want to include in our portfolio — one that is trending well and receiving positive earnings estimate revisions.
Notice how shares reside above upward-sloping 50-day (blue line) and 200-day (red line) moving averages, a hallmark of a healthy bull trend, with the stock recently notching fresh highs. Momentum has steadily built throughout 2026. With improving fundamentals and a constructive technical picture, ROST appears positioned to continue its outperformance.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. As we know, Ross Stores has recently witnessed sharp upward revisions. As long as this trend remains intact (and ROST continues to deliver earnings beats), the stock will likely continue its bullish run.
Bottom Line
Backed by a leading industry group and a powerful history of earnings beats, it’s not difficult to see why this off-price juggernaut is a compelling investment. Currently, ROST sports a Zacks Rank #1 (Strong Buy), driven by robust upward estimate momentum.
The combination of record comparable-sales growth, expanding margins, an aggressive store-opening runway, and a deeply resonant value proposition provides a tailwind for the share price. Robust fundamentals combined with a strengthening technical trend certainly justify adding shares to the mix. If you haven’t already done so, be sure to put Ross Stores on your watchlist.
Bear of the Day:
Lennar Corp. is one of the largest homebuilders in the United States, constructing and selling homes across a wide range of price points — from entry-level and first-time buyers to move-up and active-adult communities.
Beyond its core homebuilding operations, the company runs a financial-services arm that provides mortgage financing, title, and closing services to its homebuyers, along with a multifamily development business and other ancillary ventures. Homebuilding contributes the overwhelming majority of revenues, which means the company’s fortunes rise and fall with the health of the new-home market.
For all its scale and operational sophistication, Lennar finds itself squarely on the wrong side of the housing cycle. The company’s results have been defined by a steady erosion in earnings, declining average selling prices, and persistent margin compression.
Elevated mortgage rates and stretched affordability continue to weigh on buyer demand, forcing Lennar to lean heavily on sales incentives, rate buydowns, and price concessions to keep its sales machine moving. Those tactics protect unit volume but punish profitability, and they have pushed gross margins on home sales meaningfully lower — management has guided the metric down toward 16%, a far cry from the lofty margins of the post-pandemic boom.
The average selling price of homes delivered has also drifted lower, reflecting both a shift toward more affordable product and the discounting required to move inventory. With the demand backdrop unlikely to improve materially while rates remain elevated, the path of least resistance for earnings remains downward, and the company has openly acknowledged a strategy that favors maintaining volume over defending price.
The Zacks Rundown
Lennar ( LEN ) has been a clear laggard, with shares mired in a downtrend and underperforming badly — the stock has lost roughly 14% year-to-date against about a 7% gain for the S&P 500. A Zacks Rank #5 (Strong Sell), LEN reflects unfavorable earnings estimate revision trends over the one-to-three-month horizon.
Shares are part of the Zacks Building Products – Home Builders industry group, which currently ranks in the bottom 7% out of approximately 250 industries. Because this industry is ranked in the bottom half of all Zacks Ranked Industries, we expect it to underperform the market over the next 3 to 6 months, just as it has this year.
While individual stocks have the ability to outperform even when included in weak industries, their industry association serves as a headwind for any potential rallies. Stocks in this industry are also expected to post below-average earnings growth. With much better alternatives available in the current market environment, this stock should be avoided.
Cracks in the Foundation: Declining Earnings and Falling Estimates
Even when Lennar clears a hurdle, the trend underneath is unmistakably negative. In its most recent second-quarter fiscal 2026 report, adjusted earnings of $1.31 per share nudged past a sharply lowered Zacks Consensus Estimate of $1.23 — but that figure still represented a 31% collapse from $1.90 in the year-ago quarter. Revenues of $7.94 billion missed the consensus mark by 1.6% and fell more than 5% year over year, pressured by lower home prices and affordability constraints.
The longer pattern is what should concern investors. Over the trailing four quarters, Lennar has surpassed consensus EPS estimates just once and topped revenue estimates just once. Management also trimmed its full-year 2026 delivery outlook to roughly 82,000-83,000 homes from about 85,000, while guiding gross margins down toward 16%. Analysts have been steadily marking estimates lower, and the stock carries a negative Earnings ESP — precisely the deteriorating setup the bears look for.
Technical Outlook
LEN stock has been carving out a well-defined downtrend. Notice how both the 50-day (blue line) and 200-day (red line) moving averages are sloping lower, with shares trading below them and drifting toward the lower end of their 52-week range.
The persistent decline has produced a classic “death cross,” wherein the 50-day moving average crosses below the 200-day moving average — a bearish technical signal that often precedes further weakness. Shares would need to mount a serious move to the upside and show improving earnings estimate revisions to warrant taking any long positions.
Final Thoughts
As a company heavily levered to the cyclical, rate-sensitive housing market, Lennar is absorbing the full brunt of weak demand and margin pressure. A deteriorating fundamental and technical backdrop show that this stock doesn’t deserve a spot in portfolios right now, and its membership in one of the weakest industry groups adds yet another headwind.
The Zacks Style Scores reinforce the bearish picture, with LEN carrying a VGM Score of F, a Value Score of D, a Growth Score of F, and a Momentum Score of F. Falling future earnings estimates will likely serve as a ceiling to any potential rallies, nurturing the downtrend. Potential investors may want to give this stock the cold shoulder, or perhaps consider it as part of a short or hedge strategy.
Additional content:
This AI Memory Stock Soars 600% — Could Be the Next NVIDIA
Demand for NVIDIA Corporation’s state-of-the-art chips has exploded in recent years, pushing the company’s market capitalization over $4 trillion and making it the most valuable company ever.
Despite this astounding growth, NVIDIA’s shares experienced periods of volatility as investors questioned whether artificial intelligence (AI)-related spending could continue to grow fast enough to justify NVIDIA’s mammoth size. The stringent China-related export curbs could further put pressure on NVIDIA’s revenue growth and profit margins.
NVIDIA’s shares gained 35.3% over the past year, but one AI memory stock — Seagate Technology Holdings plc — delivered stronger returns, skyrocketing 647.9%. Let’s thus take a closer look at what the key catalysts are behind its rally and why its growth trajectory may be far from over –
Seagate’s AI-Fueled Growth Engine Just Getting Started
In the third quarter of fiscal 2026, Seagate generated $3.11 billion in revenues, up 44% from the year-ago period, according to investors.seagate.com. Such rapid growth is uncommon among hardware manufacturers and reflects strong customer demand for Seagate’s high-capacity storage solutions. The main engine of growth is Seagate’s nearline storage business, which provides high-capacity hard drives to data center customers.
Importantly, Seagate’s revenue growth shows little sign of slowing down. This is because the company expects fiscal fourth-quarter 2026 revenues to be around $3.45 billion, plus or minus $100 million, indicating sustained growth momentum.
The company also expects non-GAAP diluted earnings per share (EPS) of $5, plus or minus 20 cents, for the fiscal fourth quarter, compared with $4.1 in the fiscal third quarter. Additionally, the company’s strong 47% non-GAAP gross margin in the fiscal third quarter highlights improving profitability, operational leverage and strong pricing power.
To top it off, Seagate’s free cash flow reached $953 million during the fiscal third quarter, underscoring the strength of its underlying business and providing sufficient financial strength to fund future growth initiatives.
Seagate Emerging as a Quiet Winner of the AI Boom
Seagate’s accelerating demand for data-center storage, improving margins, and solid cash flows have set the stage for continued growth, which could translate into additional gains in its share price, making it one of the strong contenders that could mirror NVIDIA’s rise.
No doubt, Seagate is a cyclical stock, but for now, it is benefiting from the sharp demand surges driven by the AI data storage boom. Seagate’s chair and chief executive officer, Dave Mosley, confirmed that “Seagate is entering a new era of structural growth as AI applications amplify data creation and support sustained storage demand.”
Reflecting this momentum, the company’s expected earnings growth rate for the current and next year is a solid 84.3% and 85.7%, respectively. The Zacks Consensus Estimate of $14.93 for STX’s EPS is up 51% year over year.
Seagate currently has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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Seagate Technology Holdings PLC (STX): Free Stock Analysis Report
NVIDIA Corporation (NVDA): Free Stock Analysis Report
Ross Stores, Inc. (ROST): Free Stock Analysis Report
Lennar Corporation (LEN): Free Stock Analysis Report
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