Many stocks have been testing new highs in 2020, and one of the most notable is Ralph Lauren Corporation (RL). Currently, RL is trading at $90.26 and the avg recommendation for the stock is Moderate Buy. while the current analyst price target stands at $89.38.
To add more color to this target, the company’s high over the last year is $128.29 and the low is $59.82. Over the last 52 weeks, RL is down -29.64% while the S&P 500 is up 1.21%. The catalyst for this interesting swing was the company’s recent earnings report.
A Notable Earnings Report
In the last quarter, RL reported a profit of $594.4 million. Ralph Lauren Corporation also saw revenues increase to $1.27 billion. In addition, RL has free cash flow of $484.3 million as of 03-2020 The company’s EBITDA came in at -$215.3 million which compares well with its peers.
RL booked profit margins of 6.20%, its Return on Equity (ROE) is 13.10%, and its Return on Assets is 5.20%. All told, it is clear that, RL needs to be on your watchlist.
About Ralph Lauren Corporation
If readers are unfamiliar, 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 accessories, which comprise sandals, eyewear, watches, fashion and fine jewelry, scarves, hats, gloves, umbrellas, and belts, as well as leather goods, such as handbags, luggage, small leather goods, and belts; home products consisting of bedding and bath products, furniture, fabrics and wallpapers, lightings, tabletops, floorcoverings, 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, Chaps, Club Monaco, and other brand names; women’s fragrances under the Ralph Lauren Collection, Woman by Ralph Lauren, Romance Collection, Ralph Collection, and Big Pony Women’s brand names; and men’s fragrances under the Polo Blue, Safari, Purple Label, Polo Red, Polo Green, Polo Black, Polo Supreme, Polo Sport, and Big Pony Men’s brand names. The company’s restaurant concepts include The Polo Bar in New York City; RL Restaurant in Chicago; Ralph’s in Paris; and Ralph’s Coffee concept. Ralph Lauren Corporation 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 530 retail stores and 654 concession-based shop-within-shops; and operates 80 Ralph Lauren stores, 31 Ralph Lauren concession shops, and 139 Club Monaco stores and shops through licensing partners. Ralph Lauren Corporation was founded in 1967 and is based in New York, New York.
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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. RL has a short ratio of 3.56 and outstanding shares of 73.70M.
RL has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 1.47 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at 3.13. Ralph Lauren Corporation RL also noted assets of $7.28 billion at the end of the last quarter. Investors should also keep an eye on sector updates as RL has historically followed its peers on positive news.
All told, Ralph Lauren Corporation RL has strung together solid data and demonstrated underlying fundamentals. At its current valuation, RL represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.
Ralph Lauren Corporation RL is now commanding a market cap of 6.22B and a float of 47.28M. RL is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of RL stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in RL, either long or short, and we have not been compensated for this article.