Ralph Lauren Corporation (RL) on Q4 2021 Results - Earnings Call Transcript
Operator: Ladies and gentlemen, thank you for standing by. Welcome to the Ralph Lauren Fourth Quarter and Full Year Fiscal 2021 Earnings Call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session, instructions on how to ask a question will be given at that time. As a reminder, this conference is being recorded. I'd now like to turn over the conference to our host, Ms. Corinna Van der Ghinst. Please go ahead. Corinna Van der Ghinst: Good morning, and thank you for joining Ralph Lauren's fourth quarter and full year fiscal 2021 conference call. With me today are Patrice Louvet, the company's President and Chief Executive Officer; and Jane Nielsen, Chief Operating Officer and Chief Financial Officer. After prepared remarks, we will open up the call for your questions, which we ask that you limit to one per caller. During today's call, we will be making some forward-looking statements within the meaning of the federal securities laws, including our financial outlook. Forward-looking statements are not guarantees, and our actual results may differ materially from those expressed or implied in the forward-looking statements. Our expectations contain many risks and uncertainties. Principal risks and uncertainties that could cause our results to differ materially from our current expectations are detailed in our SEC filings. To find disclosures and reconciliations of non-GAAP measures that we use when discussing our financial results, you should refer to this morning's earnings release and to our SEC filings that can be found on our Investor Relations website. And now, I will turn the call over to Patrice. Patrice Louvet: Thank you, Cory. Good morning, everyone, and thank you for joining today's call. As we close out this fiscal year, Ralph and I are proud and inspired by the way our teams have navigated through the pandemic. They have demonstrated their resilience, agility and ongoing passion for our brand and our consumers in a year unlike any other. Their commitment and execution shine through in our better-than-expected fourth quarter results. Against the volatile backdrop of the past year, we took action that has enabled us to emerge from this period a fundamentally stronger company, than when we came into it. This includes; first, across all three regions, we accelerated our work to elevate our brands, while also strengthening and simplifying our brand portfolio. We're also engaging more meaningfully with consumers and driving increased marketing to deliver higher brand awareness and purchase intent coupled with higher AURs. Second, we re-positioned each of our channels and reduced our exposure to secularly challenge areas of distribution, particularly in North America. Within wholesale, we focused our brick-and-mortar presence on our healthier stores and significantly reduced our off-price penetration. Within direct-to-consumer, we accelerated our shift to digital, step changing profitability by over 1,000 basis points, as we added new connected retail capabilities and drove quality of sales. Jane Nielsen: Thank you, Patrice, and good morning, everyone. With the extraordinary efforts of our teams around the world, we closed out the year significantly stronger than we came into it, in terms of both our financial performance as well as our key strategic initiatives. Our fourth quarter and full year results reflected increased agility across our organization as macro conditions and consumer behaviors evolved. A significant leap forward on our elevation journey as we re-positioned our distribution and accelerated our pricing gains. Our digital transformation from how we serve our consumers to the way we work and driving digital margin accretion and a better aligned operational and expense structure overall. This year we delivered the highest gross margin in the company's history, even excluding the one-time mix benefits of COVID. Our underlying gross margin for fiscal 2021 was about 64.2%. We also strengthened our balance sheet through this year of uncertainty and are pleased to announce the reinstatement of our dividend in the first quarter of fiscal 2022. And as Patrice mentioned, we announced the final stage of our strategic realignment plan with the sale of Club Monaco contributing about 40 basis points to 50 basis points to operating margins this year. These actions step the right foundation and strategic focus for our teams as we enter fiscal 2022. Moving on to our fourth quarter performance. Our business returned to growth in the fourth quarter. Total revenues increased 1% compared to an 18% decline in the third quarter. All regions improved sequentially with positive growth in Asia and Europe on a reported basis, despite continued COVID-related disruptions. North America also returned to positive comps this quarter driven by significant digital acceleration. Global wholesale revenues increased 1% and direct-to-consumer revenues were up 4%. Total digital ecosystem sales accelerated to more than 60% with double-digit growth in every region up from mid-single digits in the first nine months of the year. And we delivered digital margins that were accretive within every region and to our total company rate expanding more than a 1,000 basis points in the fourth quarter and full year. We achieved this outstanding result through a combination of higher quality of sales and operating expense leverage. This was an important step as we work toward our mid-teens company operating margin target and continue to drive digital expansion in the years to come. Operator: First question comes from Omar Saad at Evercore ISI. Omar Saad: Thanks for taking my questions. So look during COVID, you guys have made some really fundamental changes to your distribution, cost structure, the organizational structure, pared back some brands. If we look out beyond the recovery year, which I'm sure you and many others in the space will enjoy accelerating sales, but can you talk about how your brands are positioned to win in the post-pandemic world over the next few years, longer term. And Patrice can you include a discussion of how you think about balancing brand health and probability -- profitability versus chasing sales, i.e., how important is it for Ralph Lauren to return to consistent growth again. Thanks. Patrice Louvet: Good morning, Omar. Thank you for your question. So, listen we're not only well positioned to benefit from a new fashion cycle as we emerge from COVID and as consumers return to the category into the stores. But we've also really strengthened the foundations of our business and laid the groundwork over the past year for a sustainable multi-year growth trajectory of a healthier base. So to your point, yes, of course, the comps will look attractive for the coming 12 months, but because of the base period, but obviously our lens has been beyond that, looking to the next three years to five years for the company. So, as part of the work, we've of course accelerated digital, you saw that in the numbers we just announced and established infrastructure for Connected Retail around the world, and that's going to have benefits on a long-term basis. But as I step back, I think there are really three key differentiators that I would highlight to underline how we see our competitive advantage and our long-term growth potential. The first one is the strength of our brand. And over the past year, we've actually seen our purchase intent increase across all of our key markets, which we track now on a monthly basis. And as you saw with our AUR numbers, we continue to progress on our elevation journey, up 30% this quarter, up 26% this fiscal year, 16 quarters in a row of AUR growth reflection of our brand elevation journey. The other point I would highlight is that we're seeing that our brand aesthetic that's anchored in luxury classics, right. So elevated flows that you can live in is resonating with consumers who are looking for a different kinds of luxury coming out of the pandemic. One important data point for us in this brand strength area is our ability to recruit new consumers. Over the past year, we've brought in more than 4 million new consumers into our franchise and these new consumers are generally younger, higher basket size and higher profitability. And it's really only the beginning. I think we now have a consumer recruiting machine that's working very well across all of our key markets. So first area is really strength of our brand, Omar. Second area is the breadth of our lifestyle portfolio. And I think this enables us to flex across categories. The flex across different consumer interests and desires, whether that's athleisure, loungewear or more sophisticated casual. And also expand into high potential underdeveloped categories like home or like outerwear. Third area is our resources and particularly our cash position. As you know and we've prided ourselves of that, we manage our balance sheet conservatively. And I think the past years indicated that, that was probably a good choice. And we are in a position now where one, we can restart dividends, as you heard Jane mentioned earlier. And two, we have the fuel to invest in critical growth areas like digital, like marketing, and like store openings. So we feel very good about where we are in terms of our ability to fund the investment opportunities for growth to your point. I think it's fair to say that our brand remains bigger than our business. And as we look at our opportunities around the world, both on the category, consumer segment and geographical standpoint, we have many vectors of growth, even more focus now on the Ralph Lauren namesake brands posts and moves that we've made on Chaps and recently announced on Club. So listen, on top of these three differentiators, which I think are evergreen and real point of difference for us. We have the benefit of an incredibly talented global organization, that's really proven its resilience and agility and scale during this crisis. We have a diversified and flexible supply chain. And I think the portfolio that's now well-defined and tight, so we can really focus on those key value drivers. So while we're not completely done with COVID, as you look at what's happening in Japan, what's happening in parts of Europe and other parts of Asia, I am incredibly encouraged by our positioning and by the foundations that we've laid for the short, the mid and the long-term as we pivot back to offense not only this coming year, but for the years to come. To your question on quality of sales and general growth, listen we're in growth mode, right. We're in growth and value creation mode. We have a number of engines for growth. We will continue our brand elevation journey, which I think will be evergreen for this company. So our expectation is to continue to drive AUR, obviously at a more modest pace than this past year. We continue to drive AUR. Our expectation is to continue to recruit new consumers. And we also expect to start to grow units, all right. And that's really the vectors of growth moving forward. So yes, Ralph Lauren is a growth company, value creation company, obviously, we will do it profitably as we've been doing, but we're excited about what's possible for us moving forward. Jane Nielsen: And Omar, I would just add that, your question about the balance between brand, health and profitability. I mean that's the core of our strategy. We believe elevation of our brand, elevation of our distribution drive improved profitability and value creation. And I think our guidance that we're back to growth and back to our margin accretion relative to pre-COVID levels is a proof point in. That's what our strategy is going to deliver. Corinna Van der Ghinst: Next question, please. Operator: Thank you. The next question comes from Michael Binetti with Credit Suisse. Michael Binetti: Hey, guys. Thanks for taking our questions here and all the detail today. Let me ask at a high level. North America has been a big focus for a while. How are you feeling about the North America business now? A lot of the initiatives that you mentioned that you were trying to clean up over the last year are focused in that market. So how are you feeling about the North America business now, your ability to grow sustainably in the core market? And maybe you could help us by touching on a few of the key elements driving the plan. And then my second question is on SG&A, as we look at the guidance for fiscal 2022. I'm trying to -- you've done a lot of work on that line, Jane. And if I'm trying to think if the revenues come in, in an upside scenario, where it is SG&A go, if revenues beat your plan to try -- we're trying to think about how the fixed versus floating in SG&A relative to what we know about this business pre-COVID? What's the flow through on upside revenues, if you could. Patrice Louvet: Sounds good. Well, good morning, Michael, and Jane and I will answer on your questions. Listen, big picture. I have the most confidence now in our ability to win in North America, since starting with the company close to four years ago. That's really the way I feel right now by looking at where we are, what we've done and the key drivers of growth and value creation for that region. We have significant growth opportunities across the entire region. We are under developed in many key cities across the US, particularly in the West and in the South. And we have significant opportunity to expand our direct-to-consumer Connected Retail footprint. So of course is going to be the easy compares versus in fiscal year 2022 versus this past fiscal year, but all of the long-term drivers that I talked about in response to Omar's question apply here as well in our home market, of course. As you mentioned, specific to North America, the past three years or four years has been a year of reset. It's been a year of clean up, to get to a healthy base, to be positioned for growth. And so most of that work is complete now. The vast majority of it is complete. The recent interventions on our brand portfolio kind of being the closing elements of it. And we are clearly pivoting to offense across North America, across channels. We see multiple vectors of growth going forward. So if I take them one by one, first of all, our own digital, all right, which you saw the numbers this past quarter, 25% in total. Our domestic customers up 50% versus year ago, as we haven't delivered these kind of numbers on our own digital. I think since we've really been tracking it. So we're excited about the progress we're making there. The numbers are starting to reflect the higher and more margin accretive underlying growth, now that the daigou cleanup is mostly done. And this is a reflection of product that's really resonating with the consumer connected retail capabilities that the consumer is taking advantage of better functionalities on the sites and a much more effective segmentation targeting and personalization. Second area is our own retail stores, right, where our business model, our brand elevation and our Connected Retailing initiatives are working. And you're seeing the progress in the past quarter. We're driving back to sustainable positive comps and AUR. We're encouraged to see that the brick-and-mortar trends are beginning to improve. And just one data point, but our March comps were up strong double digits to last year and on a two-year stack. And with only 44 price stores, when you and I have talked this, right, we still -- we see a significant opportunity to expand our key city strategy and actually our North America team is in the field now visiting a number of locations, as we speak, we're going to do it very selectively and with a strong focus on Connected Retail centered around the consumer. And then finally on wholesale, where we've made dramatic changes over the past few years. A couple of data points. Our wholesale presence is down in terms of doors is down 61% over the past three years to four years. Our off-price penetration is down 50% over the past three years to four years. So massive resets that are now complete and now we are seeing accelerating growth, accelerating penetration of wholesale.com, where we've got very good momentum and wonderful partnerships here in the US. And we're starting to grow share in our existing wholesale doors. Past quarter, we grew share in men's. We grew share in kids, we grew share in home, and we're seeing more recently our women's business start to respond as well. So we have a healthier -- we have healthier partnerships. We have a cleaner footprint from both a digital and brick-and-mortar standpoint in wholesale. And so net -- I'd say, Michael, I feel very good about where we are, and obviously we got to deliver. But I think we're very well positioned now to win in North America. Jane Nielsen: And just, Michael, on your question on SG&A. So, obviously our guidance implies significant SG&A leverage in this year. And that's really built on, it's over 600 -- well over 600 basis points and operating margin expansion of 100 basis points to pre-COVID levels. And that's really predicated on what we've done in terms of achieving savings from our organization restructuring, obviously what we've called out for Club Monaco. And as you think about upside scenarios, and I think we've guided based on our best visibility that we have today in a fairly dynamic environment. But as you think about revenue upside, as vaccination rates might accelerate worldwide, as tourism may come back, strong -- maintenance of high digital penetrations like we saw in China, those are all upside scenarios. Our strong gross margin is really going to help us with flow through there. In terms of our cost structure, I think about the big buckets of rent and occupancy, corporate costs, depreciation are all highly leverageable in our model. And so the flow through that we get on incremental sales either in wholesale, digital or in our own stores are accretive, and a nicely accretive. So, I think you will see flow through, if there is an upside scenario on sales as we typically do. But we feel very good about how our cost structure is positioned. We feel good about our ability to invest in our brands. So our guide also implies a continued higher level of marketing at that around 6% range, which is about 150 basis points higher than pre-COVID levels. We're committed to our brand elevation journey and see that marketing is a key part of that, plus digital investments and new store investments. We'll have about 50 gross new stores in this coming year, the environments, right. We're optimistic about the environment. This is the right time to go back to elevated distribution expansion. So we think we found the balance between delivering profit accretion and investing in our business. Corinna Van der Ghinst: Next question, please. Operator: Thank you. The next question comes from Matthew Boss with JP Morgan. Matthew Boss: Great, thanks. So, Patrice, maybe to dig a little further into the pivot to offence that you cited. Could you just maybe speak to some of the lead indicators in the business that you're seeing. Maybe we could just elaborate on the market share opportunity. I think you cited men's, kids and home, and then women's over time. Just what gives you confidence in those individual category. Patrice Louvet: Sure. In lead indicators that we look at that are, are we bringing in new consumers into the fold. And past quarter in North America, our digital platforms, new consumers of 79% versus year ago. We look at our ability continue to drive AUR, right. And you saw the strong performance. I think our strongest quarter of the fiscal year actually with AUR, up 30%. And as we look at -- as we track also brand health, so purchase intent key metrics of brand health, we continue to see progress. So those all give us confidence that the work we're doing is resonating, our product is resonating, our communication is resonating, our elevation of distribution is resonating. And then, through the specific share points, I mean you have access to this, to this data as well. We are seeing our share progress on -- quite strong on men's, renewed momentum on kids, which is a business that we've worked hard to energize and strong performance on home, which as you know is a new focus for us. And we think there's significant potential there. And then, indeed more recently, as the consumer behavior on women's ready to wear pivots back to more elevated products, pivot back to more fashion, more color, right. We're seeing women buy more into Princess dresses. We're seeing them buy more into Blazers. We're seeing them buy more into novelty sweaters. We're very well positioned in these categories. So we -- this is translating into accelerating performance for us. 30 days now, I hope to be able to report a lot more, once things are fully re-open in, into -- but at the end of this quarter we're feeling good about the momentum that we're building. Jane Nielsen: Well, that Patrice's comment is predicated on North America data. Based on our best estimates, we are also seeing share gains in Europe, in wholesale. Corinna Van der Ghinst: Thank you. Next question, please. Operator: Thank you. The next question comes from Laurent Vasilescu with Exane BNP Paribas. Laurent Vasilescu: Good morning, and thanks for taking my questions. Jane, I think you mentioned that you took a little bit about $700 million in revenues out of the business, that on an underlying basis your revenues for fiscal year 2022 should be roughly flattish. Can you give us some sense of how we should think about that for 1Q or 1H, 2H? And then second question is, if I go back to the notes from last call you talked about the cost savings of around $180 million to $200 million at the -- majority of that should flow through the bottom line. Just curious if that's the right way to think about still where you guys -- are you going to lean into investments and how do we think about that versus 1H and 2H? Jane Nielsen: Sure. So Laurent, the $700 million is going to be a little more pronounced in the second half than in the first half, that's primarily driven by that we'll have Club Monaco in our results for Q1, and we'll have some residual Chaps business before the license shift in our business through Q1 and Q2. So you'll see a little bit of out-sized based on those two factors. The other, the daigou repositioning and wholesale door closures and off-price pullbacks those were relatively ratable through the year. But I think those two factors are what will distort 1H and 2H. And then on the $180 million of cost savings, about a $140 million is -- those savings are recorded in SG&A, because of our supply chain and product development organization streamlining about $40 million of that will be -- is embedded in COGS, and will flow through in COGS. And in terms of the year, it's also fairly ratable through the year. And we were encouraged in Q4, that we got an early start on that savings. The investment focus is that you point out are what I mentioned in terms of marketing versus pre-COVID levels, that 150 basis points increase in marketing. And then the store investments and digital investments, as you will see us invest as Patrice mentioned in more localized sites and some digital investments in content digitizing our supply chain. All of those are contemplated in our guidance. Corinna Van der Ghinst: Next question, please. Operator: Thank you. The next question comes from Paul Lejuez with Citigroup. Paul Lejuez: Hey, thanks guys. I'm curious how you view of EBIT margins longer term might have changed as you kind of sit here today, just as you think about beyond '22. And relative to what you're guiding for this year. What do you need to see in the business to kind of achieve those goals, some top line number that you need to get to something else that needs to change within the P&L. And also just curious if you can give us a quick update on the order books for the fall in the wholesale business. Thanks. Jane Nielsen: Sure. So in terms of our operating margin guidance on a longer-term basis, what we see is that our mid-teens operating margin guidance over the next several years is still the right goal for us. Obviously, COVID put a question mark in terms of timing to achieve. But I think as we come out of this year, we're back on about 100 basis points of margin expansion from pre-COVID levels. Obviously we're expanding margins over 600 basis points to last year. That feels like a good trajectory and a balance of growth delivering operating margin profitability and investing in our business to make sure that it's a long-term value creating growth. And then, in terms of what we're seeing on what we have to see this year, obviously we've signaled a return to growth. We've signaled underlying gross margin expansion on the backs of AUR growth that's more in line with our long-term guidance of low to mid-single digits. We have to room maintain our operating expense discipline, while still investing in our business and making sure that those businesses yield the high ROI's that we've seen through this COVID period. We've got great results on ROI from personalization and targeting and marketing investments that really lean on our brands authenticity and heritage and value. So overall, I think we are feeling confident about our plan. Obviously, we're watching the trajectory of COVID carefully. It does imply a continued recovery rate in traffic. It does imply that the closures that we see in Europe will be completed in June. So that's a variable and we're watching disruptions in the supply chain fairly, carefully. In terms of fall orders, what we're seeing in Europe is, that Europe is up. You saw strong wholesale performance in Europe, that frankly exceeded our expectations given European closures. Europe is up on a versus last year of course, but also on a LLY basis. And in the US we're seeing strong improvement outperforming the broader wholesale trend and our sell-in is much better align now to sell-out. You saw over the past year we've been carefully managing inventories. We're now better aligned with positive sell-out in the fourth quarter and going forward we're seeing the order book better aligned to our sell-out trends, which were encouraged by. Corinna Van der Ghinst: Thank you. Next question, please. Operator: Thank you. The next question comes from Ike Boruchow with Wells Fargo. Irwin Boruchow: Hey, good morning, everyone. So Jane, just to kind of go further on US wholesale, so bigger picture. I think the US wholesale business pre-COVID was around $1.5 billion. I know Chaps is coming out, so I think that's $200 million. But can you talk to us about ultimately how you see the sizing of that channel? Are you planning -- if there's any more detail on this year and how you're planning it that'd be great. But even multi-year is the business you're planning to kind of walk away from post-pandemic that maybe you just felt is not the most efficient, maybe it's lower margin. Just kind of trying to think about $1.5 billion pre-COVID maybe two years, three years from now, where ultimately do you kind of see that landing? Jane Nielsen: Of course. So what I feel really good about in North America, which Patrice commented on in his question is that we are essentially done with the repositioning that we needed to do across our broad wholesale channel. So wholesale of course is off-price, which we've significantly reshaped strategically and taken down materially. And we feel good about that business that is now strategically re-positioned to be what it should be, which is a vehicle for excess liquidation. We feel really good that we got out ahead of closing some of the 232 doors in North America. We feel like our store footprint is now elevated and appropriate to move forward. And you're starting to see us gain market share in the channel. And we feel good about the growth that you -- that we're seeing in wholesale.com. And view that as the continued source of growth for us as we move forward. You saw significant pick up in wholesale.com in North America and in Europe in the fourth quarter. So, we feel good about the Proofpoint and the trends on the back of some pilot initiatives, dedicated resourcing and dedicated content that we put there. So just for sizing, we feel like the North America will be a source of growth for us. It will also be a source of sustainable growth for us driven by digital, driven by pure plays and driven by market share gains in the district footprint, distribution footprint, which we now feel very good about. Corinna Van der Ghinst: We'll take one last question, please. Operator: Thank you. Our final question comes from John Kernan with Cowen. John Kernan: Excellent. Thanks for sneaking me in. Corinna Van der Ghinst: Go ahead. John Kernan: Hey, can you talk to EBIT level impacts from the shift in Chaps and then the sale of Club Monaco? Jane Nielsen: So the sale of Club Monaco, this year should add about 40 basis points to 50 basis points of operating margin, accretion. And then Chaps, while it has a meaningful hit on the bottom line is, will generate more dollars on the bottom line, but it's relatively small. Patrice Louvet: All right. Well, thank you, everyone for joining us today. We are very proud, Jane and I and Ralph of the resilience and agility, our teams have demonstrated in delivering a strong close to the year. Looking ahead, hopefully, you took this away from our conversation today, we are confident in our ability to deliver sustainable long-term growth and value creation not only this fiscal year but also beyond. And we look forward to sharing our first quarter fiscal year 2022 results with you in August. Until then, stay safe and have a great day. Operator: Ladies and gentlemen, that does conclude your conference for today. Thank you for your participation. You may now disconnect.
Ralph Lauren Posts Q4 Beat, Strong Margins, and Solid Outlook
Ralph Lauren (NYSE:RL) reported fourth-quarter 2025 results that topped analyst expectations across the board, fueled by strong sales growth and margin expansion.
The company posted EPS of $2.27, beating the $2.04 consensus. Revenue reached $1.7 billion, ahead of the $1.64 billion estimate. On a constant currency basis, revenue rose 10%, outpacing the projected 7.3%, while comparable sales jumped 13%, well above the expected 7.68%.
Profitability also exceeded expectations, with an adjusted gross margin of 68.6% versus the 67.2% forecast, and an operating margin of 10.3%, slightly ahead of the 9.97% projection.
Looking forward, Ralph Lauren guided to low-single-digit revenue growth for fiscal 2026 in constant currency, with most of that growth anticipated in the first half of the year—suggesting continued momentum in brand demand and operational efficiency.
Ralph Lauren Corporation's Strong Financial Performance
- Ralph Lauren Corporation (NYSE:RL) reported an earnings per share (EPS) of $2.27, surpassing estimates and indicating a 33% rise year-over-year.
- The company achieved a revenue of approximately $1.7 billion, an 8% increase from the previous year, beating consensus estimates.
- Ralph Lauren's financial metrics, including a price-to-earnings (P/E) ratio of 24.52 and a price-to-sales ratio of 2.46, reflect strong investor confidence and market valuation.
Ralph Lauren Corporation, listed on the NYSE:RL, is a prominent player in the luxury apparel industry. Known for its premium clothing and accessories, the company has consistently demonstrated strong financial performance. Ralph Lauren competes with other luxury brands in the textile-apparel sector, maintaining a robust market position.
On May 22, 2025, Ralph Lauren reported earnings per share (EPS) of $2.27, surpassing the estimated $2. This represents a 33% rise in adjusted EPS compared to the previous year, as highlighted by Barron's. The company has consistently outperformed consensus EPS estimates over the past four quarters, showcasing its strong financial management.
Ralph Lauren achieved a revenue of approximately $1.7 billion, exceeding the estimated $1.65 billion. This marks an 8% year-over-year increase, as noted by Barron's, and a 3.83% beat over the Zacks Consensus Estimate. The company's total comparable sales surged by 13%, significantly outperforming the anticipated 6.1% growth.
The company's financial metrics provide further insight into its performance. Ralph Lauren's price-to-earnings (P/E) ratio is approximately 24.52, indicating investor confidence in its earnings potential. The price-to-sales ratio stands at about 2.46, reflecting the value placed on each dollar of sales. Additionally, the enterprise value to sales ratio is around 2.56, offering a perspective on the company's valuation relative to its revenue.
Ralph Lauren's CEO, Patrice Louvet, expressed confidence in the company's future, emphasizing plans to focus on growth across various lifestyle categories, geographies, and channels. The company aims to maintain agility and leverage its diversified supply chain, operating discipline, and robust balance sheet to navigate current macroeconomic challenges. Ralph Lauren also anticipates a modest expansion in its operating margin.
Ralph Lauren Corporation (NYSE: RL) Sees Optimistic Analyst Price Targets Amid Financial Growth
- The consensus price target for Ralph Lauren Corporation (NYSE: RL) has increased from $213.23 to $265.67, indicating a positive shift in analyst sentiment.
- Ralph Lauren is expected to experience earnings growth, with a potential earnings beat in its upcoming report, as suggested by analysts.
- Despite market volatility, RL's stock rose by 2.8%, showcasing resilience and market confidence in its performance.
Ralph Lauren Corporation (NYSE: RL) is a renowned name in the fashion industry, known for its premium lifestyle products. The company designs, markets, and distributes a wide range of products, including apparel, accessories, and home furnishings. Over the past year, the consensus price target for RL has increased significantly, reflecting growing optimism among analysts about the company's future performance.
A year ago, the average price target for RL was $213.23, indicating a more conservative outlook. However, recent data shows that the average price target has risen to $265.67. This upward trend suggests that analysts are more optimistic about Ralph Lauren's potential growth. Factors such as improved financial performance and strategic initiatives may have contributed to this positive sentiment.
Ralph Lauren is anticipated to experience earnings growth in its upcoming report, suggesting a potential earnings beat. Analyst Ike Boruchow from Wells Fargo has set a price target of $110 for the stock, indicating a positive outlook. This suggests that Ralph Lauren has the right combination of factors to support expected growth, making it a promising opportunity in the consumer discretionary sector.
Despite a volatile market environment, RL experienced a positive trading session, with its stock rising by 2.8%. This increase occurred even as major indices like the Dow Jones Industrial Average, Nasdaq Composite, and S&P 500 ended the day lower. This resilience highlights the market's confidence in Ralph Lauren's performance amidst broader market uncertainties.
Investors are encouraged to consider Ralph Lauren as a potential investment opportunity. The Zacks Earnings ESP tool is highlighted as a valuable resource for identifying stocks likely to exceed quarterly earnings estimates. With a strong track record of surpassing earnings expectations, RL is well-positioned to potentially exceed estimates in its upcoming quarterly report.
Ralph Lauren Corporation's Anticipated Quarterly Earnings: A Financial Overview
- Analysts have adjusted their EPS estimates to $1.96, indicating a 14.6% increase from the previous year.
- Ralph Lauren's revenue is projected to reach $1.63 billion, a 4.1% increase from the same quarter last year.
Ralph Lauren Corporation, listed on the NYSE:RL, is a renowned name in the fashion industry, known for its premium clothing and lifestyle products. As the company prepares to release its quarterly earnings on May 22, 2025, Wall Street analysts are keenly observing the anticipated financial performance.
Analysts have slightly adjusted their EPS estimates to $1.96, reflecting a 14.6% increase from the previous year. This revision, although minor, indicates a reevaluation of initial expectations. Historically, such changes in earnings estimates have been linked to short-term stock price movements, suggesting potential volatility in RL's stock following the earnings announcement.
Ralph Lauren's revenue is projected to reach $1.63 billion, marking a 4.1% increase from the same quarter last year. This growth is indicative of the company's strong brand momentum and digital expansion. However, currency fluctuations might impact the overall gains. In the previous quarter, RL exceeded earnings expectations by 7.6%, contributing to an average earnings surprise of 6.5% over the last four quarters.
The market is closely monitoring the upcoming earnings report, as it could significantly influence RL's stock price. A positive earnings surprise could lead to an upward movement, while results falling short of expectations might cause a decline. The sustainability of any immediate price changes will depend on management's discussion of business conditions during the earnings call.
Ralph Lauren's financial metrics, such as a P/E ratio of 24.85 and a price-to-sales ratio of 2.49, provide insight into its valuation. The company's enterprise value to sales ratio is 2.60, and its enterprise value to operating cash flow ratio is 14.63. With a debt-to-equity ratio of 1.06 and a current ratio of 1.76, RL maintains a stable financial position, supporting its growth prospects.
Ralph Lauren Corporation (NYSE:RL) Stock Update and Financial Outlook
- Paul Kearney from Barclays sets a price target of $260 for NYSE:RL, indicating a potential upside of 18.2%.
- Ralph Lauren's upcoming earnings report anticipates an EPS of $1.96, a 14.62% increase year-over-year, with revenue expected to rise by 4.05%.
- Despite a slight decline in the latest trading session, RL's stock demonstrates resilience with a lesser decrease over the past month compared to the Consumer Discretionary sector and the S&P 500.
Ralph Lauren Corporation, listed on the NYSE under the symbol RL, is a renowned global leader in the design, marketing, and distribution of premium lifestyle products, including apparel, accessories, home furnishings, and fragrances. The company competes with other high-end fashion brands like Burberry and Gucci. On April 28, 2025, Paul Kearney from Barclays set a price target of $260 for RL, suggesting a potential upside of 18.2% from its current trading price of $219.96.
In the latest trading session, RL closed at $219.96, marking a slight decline of 0.09% from the previous day. This performance lagged behind the broader market, with the S&P 500 gaining 0.74%, the Dow increasing by 0.05%, and the Nasdaq rising by 1.26%. Despite this, RL's stock has shown resilience over the past month, decreasing by only 2.23%, which is better than the Consumer Discretionary sector's loss of 4.48% and the S&P 500's decline of 4.77%.
Investors are keenly awaiting Ralph Lauren's upcoming earnings report. The company is expected to announce an earnings per share (EPS) of $1.96, a 14.62% increase compared to the same quarter last year. Additionally, the consensus estimate for revenue is $1.63 billion, marking a 4.05% rise from the previous year's quarter. These figures indicate a positive outlook for the company's financial performance.
Currently, RL's stock price is $219.96, reflecting a slight decrease of 0.19, or approximately -0.09% in percentage terms. During today's trading, the stock has fluctuated between a low of $217.01 and a high of $221.55. Over the past year, RL has reached a high of $289.33 and a low of $155.96, showcasing its volatility. The company's market capitalization stands at approximately $13.59 billion, with a trading volume of 741,590 shares on the NYSE.
Ralph Lauren Corporation (NYSE:RL) Stock Update and Financial Outlook
- Paul Kearney from Barclays sets a price target of $260 for NYSE:RL, indicating a potential upside of 18.2%.
- Ralph Lauren's upcoming earnings report anticipates an EPS of $1.96, a 14.62% increase year-over-year, with revenue expected to rise by 4.05%.
- Despite a slight decline in the latest trading session, RL's stock demonstrates resilience with a lesser decrease over the past month compared to the Consumer Discretionary sector and the S&P 500.
Ralph Lauren Corporation, listed on the NYSE under the symbol RL, is a renowned global leader in the design, marketing, and distribution of premium lifestyle products, including apparel, accessories, home furnishings, and fragrances. The company competes with other high-end fashion brands like Burberry and Gucci. On April 28, 2025, Paul Kearney from Barclays set a price target of $260 for RL, suggesting a potential upside of 18.2% from its current trading price of $219.96.
In the latest trading session, RL closed at $219.96, marking a slight decline of 0.09% from the previous day. This performance lagged behind the broader market, with the S&P 500 gaining 0.74%, the Dow increasing by 0.05%, and the Nasdaq rising by 1.26%. Despite this, RL's stock has shown resilience over the past month, decreasing by only 2.23%, which is better than the Consumer Discretionary sector's loss of 4.48% and the S&P 500's decline of 4.77%.
Investors are keenly awaiting Ralph Lauren's upcoming earnings report. The company is expected to announce an earnings per share (EPS) of $1.96, a 14.62% increase compared to the same quarter last year. Additionally, the consensus estimate for revenue is $1.63 billion, marking a 4.05% rise from the previous year's quarter. These figures indicate a positive outlook for the company's financial performance.
Currently, RL's stock price is $219.96, reflecting a slight decrease of 0.19, or approximately -0.09% in percentage terms. During today's trading, the stock has fluctuated between a low of $217.01 and a high of $221.55. Over the past year, RL has reached a high of $289.33 and a low of $155.96, showcasing its volatility. The company's market capitalization stands at approximately $13.59 billion, with a trading volume of 741,590 shares on the NYSE.
Ralph Lauren’s Price Target Boosted at TD Cowen
TD Cowen analysts increased their price target for Ralph Lauren (NYSE:RL) from $197 to $202 while maintaining a Buy rating on the stock.
The analysts highlighted that Ralph Lauren continues to achieve margin-accretive growth in its direct-to-consumer (DTC) channel, which accounts for 69% of its sales.
The analysts mentioned Jane Nielsen stepping down as CFO, and emphasizing her effective management that resulted in a mid-teens EBIT margin (excluding foreign exchange impacts) in fiscal 2025 and a 29% return on invested capital (ROIC), with potential for further growth.
The price target has been raised to $202, reflecting confidence that brand elevation can sustain a low-double-digit compound annual growth rate (CAGR) in EPS.
