May 23 (Reuters) - Ross Stores ( ROST ) on Thursday

posted first-quarter results above Wall Street estimates and

raised its annual profit forecast, as shoppers pivot to

off-price retailers prompted by sticky inflation that have

squeezed their budgets.

The California-based company's shares jumped nearly 7% to

$141 in extended trading, after the company also posted an

increase of 205 basis points in its quarterly operating margin.

Over the last year, Ross's sales have recovered amid

moderating inflation and a strong response to its value

offerings on branded and designer apparel and footwear among its

core lower-income cohort.

Still, the company cautioned on pressures in discretionary

spending and said it would continue to manage inventory and

expenses tightly in order to maximize sales and earnings growth

over the balance of the year.

"Ongoing uncertainty in today's macroeconomic and

geopolitical environments, including prolonged inflation,

continue to squeeze our low-to-moderate income customers'

purchasing power," said Ross CEO Barbara Rentler.

Ross's results echo that of its off-price peer TJX Cos ( TJX )

which, a day earlier, posted better-than-expected

first-quarter results and raised annual profit forecast helped

by easing costs and strong demand.

There were concerns around the company's lower income, more

price-sensitive shoppers, Telsey Advisory Group analyst Dana

Telsey wrote in a note on May 17.

The company logged sales of $4.86 billion for the quarter

ended May 4, above analysts' average estimate of $4.83 billion,

according to LSEG data.

It earned $1.46 per share compared to expectations of $1.35.

It maintained fiscal 2024 comparable store sales forecast at

2% to 3% rise and now expects profit per share in the range of

$5.79 to $5.98, from prior range of $5.64 to $5.89.