Buy rating initiated on Ralph Lauren shares as margins improve amid cost reductions

EditorAhmed Abdulazez Abdulkadir
Published 12/31/2024, 09:28 AM
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Argus highlighted that Ralph Lauren's stock has shown a bullish pattern with higher highs and higher lows since September 2022. The firm also pointed out that the company's stock is trading at 17 times their fiscal year 2025 earnings per share (EPS) estimate, which is at the higher end of its five-year average annual range of 12-17 times.

With a current P/E ratio of 21.6 and analyst targets ranging from $150 to $300, investors seeking deeper insights can access comprehensive valuation metrics and 15 additional ProTips through InvestingPro's detailed research reports. Considering the enhanced earnings outlook and the company's strong fundamentals, Argus believes that a Buy rating is now warranted for Ralph Lauren stock. They have set a 12-month price target of $250, indicating a positive outlook for the stock's performance in the coming year.

Argus highlighted that Ralph Lauren's stock has shown a bullish pattern with higher highs and higher lows since September 2022. The firm also pointed out that the company's stock is trading at 17 times their fiscal year 2025 earnings per share (EPS) estimate, which is at the higher end of its five-year average annual range of 12-17 times. With a current P/E ratio of 21.6 and analyst targets ranging from $150 to $300, investors seeking deeper insights can access comprehensive valuation metrics and 15 additional ProTips through InvestingPro's detailed research reports.

Considering the enhanced earnings outlook and the company's strong fundamentals, Argus believes that a Buy rating is now warranted for Ralph Lauren stock. They have set a 12-month price target of $250, indicating a positive outlook for the stock's performance in the coming year.

Argus highlighted that Ralph Lauren's stock has shown a bullish pattern with higher highs and higher lows since September 2022. The firm also pointed out that the company's stock is trading at 17 times their fiscal year 2025 earnings per share (EPS) estimate, which is at the higher end of its five-year average annual range of 12-17 times.

Considering the enhanced earnings outlook and the company's strong fundamentals, Argus believes that a Buy rating is now warranted for Ralph Lauren stock. They have set a 12-month price target of $250, indicating a positive outlook for the stock's performance in the coming year.

In other recent news, Ralph Lauren Corporation (NYSE:RL) has demonstrated a strong financial performance in the second quarter of its fiscal year 2025, with a 6% revenue growth and direct-to-consumer sales on the rise. The company has attributed this performance to effective pricing strategies and reduced discounting, which led to a 10% increase in retail comparable sales and average unit retail (AUR). The addition of 1.5 million new customers, primarily from younger demographics, has also contributed to this positive trend.

Ralph Lauren's adjusted gross margins improved to 67.1%, a rise of 170 basis points. However, the company's operating expenses increased by 7% due to planned marketing investments. Despite this, Ralph Lauren has raised its full-year revenue outlook to a growth range of 3% to 4%. The company's performance has been particularly strong in Asia, with a 10% revenue increase.

In other developments, Telsey Advisory Group has adjusted its outlook on Ralph Lauren, increasing the price target to $247 from the previous $207 while maintaining an Outperform rating. This adjustment comes after Ralph Lauren's robust financial quarter, which surpassed expectations due to increased sales and gross margins. The company's strategies, including brand elevation, winning in key cities, and expanding into new categories, are expected to drive top-line growth.

Lastly, according to a Bernstein analyst, the U.S. Apparel & Specialty Retail sector, including Ralph Lauren, has had a strong start to the holiday quarter. This positive start is largely attributed to a drop in temperatures later than expected, which has been beneficial for early fourth-quarter comparisons. The report also highlighted a recovery in spending among higher-income U.S. consumers, which is driving growth this quarter for retailers and brands.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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