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UK train strikes and energy hikes add to a week of turmoil
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Russia blindfolds, detains Ukraine nuclear plant chief
NIH to fund unproven ALS drugs under patient-backed law
S&P 500   3,585.62
DOW   28,725.51
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Russia accused of 'kidnapping' head of Ukraine nuclear plant
EU chief: New Greece-Bulgaria gas pipeline 'means freedom'
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Danish Energy Agency says Nord Stream 2 gas pipeline under Baltic Sea appears to have stopped leaking gas
UK train strikes and energy hikes add to a week of turmoil
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Russia blindfolds, detains Ukraine nuclear plant chief
NIH to fund unproven ALS drugs under patient-backed law
S&P 500   3,585.62
DOW   28,725.51
QQQ   267.26
Want to Increase Your Conversion Rates? This Is the Biggest Threat to Your Success.
The 3-Stock Retirement Blueprint (Ad)
Russia accused of 'kidnapping' head of Ukraine nuclear plant
EU chief: New Greece-Bulgaria gas pipeline 'means freedom'
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Danish Energy Agency says Nord Stream 2 gas pipeline under Baltic Sea appears to have stopped leaking gas
UK train strikes and energy hikes add to a week of turmoil
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Russia blindfolds, detains Ukraine nuclear plant chief
NIH to fund unproven ALS drugs under patient-backed law

Ralph Lauren Is A Retail Stock You Can Buy And Hold

Ralph Lauren Is A Retail Stock You Can Buy And Hold

Ralph Lauren (NYSE: RL) and brands like Levi Strauss (NYSE: LEVI) and Calvin Klein parent PVH Corp (NYSE: PVH) are winning in the retail wars for two reasons. The first is a well-loved brand, the second is a push into direct-to-consumer sales and eCommerce. The combination has the company set up to outperform most others in the industry and there are other reasons to like this stock as well. The stock is yielding nearly 2.8% compared to just over 2.0% for Levi Strauss and less than 0.25% for PVH. Trading at 12.5X its earnings it is also a value relative to the broader market and one that pays an above-average dividend in that respect as well. While the retail sector is as shaky as ever, Ralph Lauren is a winning investment growing on a global scale. 

"While the global operating environment remains as volatile as ever, our talented, passionate teams are delivering on the multiple growth opportunities to scale our business with creativity and discipline — from driving high-quality new consumer recruitment to expanding digital and elevating our touch points in every region and channel,” says CEO Patrice Louvet. 

Ralph Lauren Wows The Market With Results 

Ralph Lauren has been outperforming over the past few quarters so it was no surprise to see strong results. What is surprising is the revenue results beat the Marketbeat.com consensus by over 700 basis points and there is good news on the bottom line as well. The company reported $1.5 billion in net sales for a gain of 8.7% over last year that was driven by strength in all regions and channels. The top line was impacted by FX headwinds, however, which shaved more than 400 basis points off the currency-neutral results. On a comp-store basis, sales are up in the mid-teens. 


The better news, however, is that pricing actions, mix, and efforts to mitigate supply chain hurdles more than offsetting the impacts of higher freight costs. The adjusted gross and operating margins contracted versus last year but less than expected which left the bottom line results ahead of the consensus as well. On the bottom line, the $1.88 in adjusted EPS beat the consensus by nearly 1000 basis points and the outlook for the remainder of the year is favorable too. 

Ralph Lauren is expecting to see revenue growth accelerate in the 2nd fiscal quarter of the year and for margins to improve as well. The company is looking for revenue growth in the range of 11% for the 2nd quarter and 8% for the year compared to a low-single-digit consensus expectation and the operating margin should improve as much as 200 basis points by the end of the year. 

Ralph Lauren Is AHigh-Quality Dividend 

Ralph Lauren is not only a relatively high-yielding stock but it is also a high-quality payer. The company is distributing only 33% of its earnings and there are no red flags on the balance sheet. The company has some debt but it is net cash with positive cash flow and ample coverage, ample enough to leave room for buybacks as well. The company repurchased $213 million worth of shares in the Q1 period and can be expected to repurchase more shares as the year wears on. 

The Technical Outlook: Ralph Lauren Moves Higher 

The price action in Ralph Lauren is up in premarket action and may move higher in the open session. The caveat is that price action is still below the $105 level which could produce stiff resistance. If the market can get above the $105 level a move up to the $110 to $115 range is expected. If not, this stock may be range bound at the current levels until later in the year. 

Ralph Lauren Is A Retail Stock You Can Buy And Hold

Ralph Lauren is a part of the Entrepreneur Index, which tracks some of the largest publicly traded companies founded and run by entrepreneurs.

Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Ralph Lauren (RL)
3.052 of 5 stars
$84.93-2.7%3.53%11.22Hold$118.00
PVH (PVH)
2.9233 of 5 stars
$44.80-3.6%0.33%3.43Hold$77.53
Levi Strauss & Co. (LEVI)
2.6969 of 5 stars
$14.47-6.9%3.32%10.05Moderate Buy$26.27
Compare These Stocks  Add These Stocks to My Watchlist 

Should you invest $1,000 in Ralph Lauren right now?

Before you consider Ralph Lauren, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Ralph Lauren wasn't on the list.

While Ralph Lauren currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys.

View The Five Stocks Here

Thomas Hughes

About Thomas Hughes

Contributing Author: Technical and Fundamental Analysis

Thomas got his start with the markets while working as a Chef. In 2005 a chance invitation to attend the seminar “How To Buy And Sell Your Own Stocks” altered his worldview. Soon trading and stocks consumed his every waking moment to the point of excluding all else. Thomas now enjoys a much different lifestyle engaged in his true passion, uncovering great investments.
Contact Thomas Hughes via email at tmhughes.writeon@gmail.com.
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