ROSS STORES, INC. (ROST) vs. Alibaba Group Holding Ltd (BABA) Stock Comparison & Valuation | Edwyn

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ROSS STORES, INC. (ROST) vs. Alibaba Group Holding Ltd (BABA) Stock Comparison & Valuation | Edwyn

Updated 2026-08-02 19:19 UTC

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ROST screens as the higher-quality operator with far better ROIC and materially cheaper trading multiples than BABA, but the valuation signal is muddied by BABA’s much larger scale and higher growth, making the setup mixed rather than clearly mispriced.

Actionable Takeaway

If you believe ROST can sustain its high ROIC and mid-single-digit to high-single-digit growth without margin compression, then favor ROST over a BABA-based BABA-implied valuation because ROST is materially cheaper on P/E, P/S, and EV/EBITDA while showing stronger capital efficiency.

ROST trades at 38.0x P/E versus BABA at 129.0x, which makes ROST look much cheaper on earnings despite the comparison showing BABA carries a much higher absolute revenue base. On the provided valuation framework, ROST’s current price of $251.07 sits well above the DCF range of $44.93-$60.79 but still within its historical band of $225.96-$276.18, suggesting the stock is closer to fair-to-rich on intrinsic value while still below BABA-implied range.

Supporting Metrics

Key Risks

ROST may deserve a lower valuation than BABA-implied levels because its current price is still above the DCF range of $44.93-$60.79.
BABA’s faster growth and higher gross/EBITDA margins could justify its premium multiples, weakening the relative discount argument.
Incomplete quality data, including missing FCF margin and Altman Z-Score, reduces confidence in the valuation conclusion.