Ralph Lauren (RL) AI Stock Analysis

• Market Cap: $14.65B
• Dividend Yield: 1.33%
• Average Volume (3M): 1.18M
• Price to Earnings (P/E): 21.7
• Beta (1Y): 1.12
• Revenue Growth: 5.23%
• EPS Growth: 24.63%
• Country: US
• Employees: 14,800
• Sector: Consumer Cyclical
• Sector Strength: 61
• Industry: Apparel - Manufacturers
• EPS (TTM): 4.82
• Shares Outstanding: 39,882,940
• 10 Day Avg. Volume: 755,045
• 30 Day Avg. Volume: 1,175,336
• PEG Ratio: 4.62
• Price to Book (P/B): 6.12
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 14.53
• Enterprise Value/Market Cap: 1.10
• Enterprise Value/Revenue: 0.60
• Enterprise Value/Gross Profit: 3.40
• Enterprise Value/Ebitda: 3.74
• 1Y Price Target: $276.18
• Price Target Upside: 11.03% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 11

Ralph Lauren's strong financial performance and positive earnings call results are the most significant factors driving the score. The company's robust profitability, cash flow generation, and increased revenue expectations outweigh technical challenges and macroeconomic risks. The valuation is reasonable, providing additional support to the stock's performance.

Positive Factors

Financial Performance

Management remains confident in brand elevation, Street expectations and growth.

Market Opportunity

The recent pullback presents a particularly attractive opportunity to own a high quality, diversified brand with strong global momentum.

Operational Strategy

The company continues to execute very well on its strategy to elevate the brand and improve pricing, brand heat, and margins.

Negative Factors

Market Sentiment

Shares pulled back -6% from intra-day highs as sector sentiment has shifted to cautious on macro noise of FX, trade tensions/tariffs and valuation expansion.

Sector Concerns

Tariffs remain a key concern for the sector, but RL's low China exposure and ability to take price are mitigating factors.

Stock Valuation

Shares of RL are up 80% in the past 6 months, translating to a 26x multiple and $394 equity value with peer regression versus European luxury pointing to a 28x multiple and $427 equity value.

Ralph Lauren Business Overview & Revenue Model

Company Description

Ralph Lauren Corporation designs, markets, and distributes lifestyle products in North America, Europe, Asia, and internationally. The company offers apparel, including a range of men's, women's, and children's clothing; footwear and accessories, which comprise casual shoes, dress shoes, boots, sneakers, sandals, eyewear, watches, fashion and fine jewelry, scarves, hats, gloves, and umbrellas, as well as leather goods, such as handbags, luggage, small leather goods, and belts; home products consisting of bed and bath lines, furniture, fabric and wallcoverings, lighting, tabletop, kitchen linens, floor coverings, and giftware; and fragrances. It sells apparel and accessories under the Ralph Lauren Collection, Ralph Lauren Purple Label, Polo Ralph Lauren, Double RL, Lauren Ralph Lauren, Polo Golf Ralph Lauren, Ralph Lauren Golf, RLX Ralph Lauren, Polo Ralph Lauren Children, and Chaps brands; women's fragrances under the Ralph Lauren Collection, Woman by Ralph Lauren, Romance Collection, and Ralph Collection brand names; and men's fragrances under the Polo Blue, Ralph's Club, Safari, Purple Label, Polo Red, Polo Green, Polo Black, Polo Sport, and Big Pony Men's brand names. The company's restaurant collection includes The Polo Bar in New York City; RL Restaurant in Chicago; Ralph's in Paris; The Bar at Ralph Lauren located in Milan; and Ralph's Coffee concept. It sells its products to department stores, specialty stores, and golf and pro shops, as well as directly to consumers through its retail stores, concession-based shop-within-shops, and its digital commerce sites. The company directly operates 504 retail stores and 684 concession-based shop-within-shops; and operates 175 Ralph Lauren stores, 329 factory stores, and 148 stores and shops through licensing partners. Ralph Lauren Corporation was founded in 1967 and is headquartered in New York, New York.

How the Company Makes Money

Ralph Lauren Corporation generates revenue through multiple streams, primarily driven by the sale of its wide range of apparel and lifestyle products. The company operates through three main channels: wholesale, retail, and licensing. The wholesale channel involves selling to department stores, specialty stores, and other third-party retailers worldwide. The retail channel includes sales from Ralph Lauren's own stores and e-commerce platforms, providing direct access to consumers. Licensing agreements also contribute significantly to the company's earnings by allowing third parties to produce and sell products under the Ralph Lauren brand, which covers categories such as eyewear, fragrances, and home furnishings. Strategic partnerships and collaborations further enhance brand visibility and market reach, contributing to Ralph Lauren's overall profitability.

Ralph Lauren Financial Statement Overview

Summary

Ralph Lauren demonstrates strong financial health with impressive profitability and cash flow generation. The company shows consistent revenue growth and efficient operations, although its balance sheet could benefit from a higher equity ratio.

Income Statement

Ralph Lauren exhibits strong profitability with a robust gross profit margin of 68.1% and a net profit margin of 10.1% for TTM. Revenue growth is positive, with a 4.8% increase from the previous year indicating solid demand for its products. The EBIT margin is healthy at 12.7%, and the EBITDA margin stands at 15.7%, reflecting efficient operations and good cost management.

Balance Sheet

The company's balance sheet is stable with a debt-to-equity ratio of 1.05, suggesting moderate leverage. The return on equity is strong at 27.8%, showcasing effective use of equity. However, the equity ratio is relatively low at 35.8%, indicating a higher proportion of liabilities in the capital structure.

Cash Flow

Ralph Lauren's cash flow situation is strong, with a notable free cash flow growth rate of 16.9% year-over-year. The operating cash flow to net income ratio is 1.75, indicating robust cash generation relative to net income. The free cash flow to net income ratio is also favorable at 1.50, showing solid free cash flow generation.

Breakdown
TTM	Mar 2024	Jun 2023	Jun 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
6.95B	6.63B	6.44B	6.22B	4.40B	6.16B
	Gross Profit
4.73B	4.43B	4.17B	4.15B	2.86B	3.65B
	EBIT
884.90M	756.40M	704.20M	798.40M	240.20M	442.80M
	EBITDA
1.15B	1.06B	801.70M	1.04B	232.60M	871.60M
	Net Income Common Stockholders
704.60M	646.30M	522.70M	600.10M	-121.10M	384.30M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.14B	1.78B	1.57B	2.60B	2.78B	2.12B
	Total Assets
7.08B	6.60B	6.79B	7.72B	7.89B	7.28B
	Total Debt
2.68B	2.68B	2.86B	3.37B	3.23B	3.03B
	Net Debt
743.50M	1.01B	1.33B	1.51B	651.30M	1.41B
	Total Liabilities
4.54B	4.15B	4.36B	5.19B	5.28B	4.59B
	Stockholders Equity
2.54B	2.45B	2.43B	2.54B	2.60B	2.69B
Cash Flow		Free Cash Flow
1.06B	904.90M	193.50M	549.00M	273.10M	484.30M
	Operating Cash Flow
1.23B	1.07B	411.00M	715.90M	380.90M	754.60M
	Investing Cash Flow
-277.00M	-256.80M	471.50M	-717.90M	195.00M	702.10M
	Financing Cash Flow
-745.00M	-665.60M	-1.21B	-665.70M	356.80M	-438.20M

Ralph Lauren Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 248.74
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RL, the sentiment is Positive. The current price of 248.74 is above the 20-day moving average (MA) of 221.07, above the 50-day MA of 222.54, and above the 200-day MA of 213.21, indicating a bullish trend. The MACD of 7.42 indicates Negative momentum. The RSI at 67.81 is Neutral, neither overbought nor oversold. The STOCH value of 89.00 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RL.

Ralph Lauren Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PVH	77 Outperform	$3.73B	6.78	11.67%	0.20%	-6.13%	-2.63%
RL	76 Outperform	$14.65B	21.68	27.57%	1.33%	5.23%	24.63%
LEVI	70 Outperform	$6.80B	19.36	18.03%	3.02%	4.63%	187.50%
ZGN	66 Neutral	$3.22B	24.46	8.89%	1.56%	2.26%	-37.52%
COLM	63 Neutral	$3.62B	16.88	12.34%	1.81%	-1.69%	-4.01%
Sector *	61 Neutral	$6.68B	11.75	3.01%	3.94%	2.61%	-21.96%
VFC	53 Neutral	$5.17B	―	-16.13%	2.71%	-8.42%	57.91%

Ralph Lauren Corporate Events

Ralph Lauren Amends Employment Terms for Key Executive

On March 30, 2025, Ralph Lauren Corporation amended its employment agreement with Halide Alagoz, ensuring her annual base salary is at least $1 million and setting her annual stock award target at $2 million starting from the fiscal 2026 grant cycle. This amendment reflects the company’s commitment to retaining key talent and may impact its financial planning and stakeholder expectations.