Why are groups in this pattern?

[hogan]

Might want to clean all the copper from your barrel using a good copper solvent like Barnes #10 and use good phosphor or nylon brush and coated cleaning rod. Check barrel's crown for nicks. Be sure to clean ALL the copper from the barrel. This can take hours. Clean until there is no more blue trace when you patch out the barrel. Use a good solvent on your patch to chase the copper cleaner.

Once cleaned entirely, shoot a New Barrel Break-In regimen of your choice. Then shoot your group. Put a dot on your target and sight using a 6 O'clock hold so the dot is sitting right on top of your crosshair intersection. Shoot at this spot for 5 or 10rds and work on your breathing and trigger press. Shoot off a sandbag and rest the rifle forend on the sandbag. Support the buttstock with another sandbagged setup and apply minimal pressure with shoulder and trigger hand.

Might also want to verify that you have a free-floating barrel using a dollar bill. See if the bill won't fit between stock and barrel all the way back to the receiver.

 

[Rsadams]

I'm sorry your early experience isn't what you had expected. It can be frustrating to shoot all day without being able to analyze the target data.
First of all, your target is much too congested to offer any analysis. You need to shoot three or five shot groups on separate targets and analyze each independently.
Most often, with new shooters, the first step is to look at basic shooting skills. How the rifle is supported, how it is held, and many other factors need to be considered before looking at ballistic issues.
There are six models (that I know of) of the Ruger American. Tell use which model you are using and what accessories you have (scope, butt plate, scope mounts, etc.) on the rifle. My .223 likes 50gr Nozlers but you're not reloading so the 55gr Federal ammo may be a bit too heavy for your Ruger, the 50 grain Fiocchi or similar round might work better - but let's see what the 55gr groups look like on better example targets before making a switch.
I hope you'll come back with more data and I hope you can maintain the discipline necessary to avoid making changes that might be recommended by some before there is enough data available to make a rational decision about what your problems really might be.

Or maybe if you can find them easy enough the 50 gr federal varmint tip in the black American eagle box... They normally shoot really well in anything..