Ralph Lauren Corp (NYSE:RL) is a United States based, publicly traded holding company that designs, markets, and sells high end men’s, women’s and children’s clothing, accessories, fragrances and home appliances and furniture to consumers around the world. The company posted earnings for its fourth quarter of fiscal 2014 on May 9 and its results were better than expected. However, the stock dropped about 6.6% on Friday despite its decent earnings report. The stock had a slight rebound and ended the day down by 2%.
Ralph Lauren Corp (NYSE:RL) reported $1.68 earnings per share, exceeding analysts’ consensus estimate of $1.63 by $0.05. During the same quarter last year, the company posted $1.41 earnings per share. Ralph Lauren had profits of $1.83 billion for the quarter, matching the consensus estimate of $1.83 billion. The corporation’s quarterly proceeds were up 13.6% on a year-over-year basis. On average, analysts predict that Ralph Lauren will post $8.77 earnings per share for the current fiscal year.
The reason Ralph Lauren Corp (NYSE:RL) fell 6.6% on Friday is possibly due to the retailer forecasting slower growth for this quarter than what Wall Street was expecting. However, the slower growth prediction is due to higher investing in areas like global retail development, infrastructure investments, and heightened advertising and marketing. As a result, Ralph Lauren’s financial growth will be slower in the short term, but investing in these areas can set up the company for higher growth in the future.
Shares of Ralph Lauren Corp (NYSE:RL) opened at $149.16 on Wednesday, May 14. The company has a 1-year high of $192.03 and a 1-year low of $141.93. The stock’s daily moving average is $148.50 and has a 50-day moving average of $155.10. The market cap for Ralph Lauren is $13.16 billion and its P/E ratio is 17.50.
On May 12, Deutche Bank analyst Greg Poole reiterated a BUY rating, but lowered his price target from $190 to $180. He explained, “As Ralph’s penchant for brand investment is already well known by the market, the focus continues on a ‘core’ biz, which is seeing positive rev/GM/OM inflection. Also, mgmt. noted improved trends in both its U.S. Factory stores & across Europe, which [he] believe[s] are not in plan.” Poole has a +1.9% average return over the S&P 500 and a 53% success rate according to TipRanks.
Goldman Sachs analyst Lindsay Drucker Mann also reiterated a BUY on May 12 and modified her price target from $185 to $180. She reasoned, “[she] […] see[s] the 4Q14 update marking a positive inflection for EPS revisions and stock performance. Headline guidance did disappoint, but this was driven by upfront spending on long-term projects, while underlying business momentum is accelerating.” Drucker Mann has +0.7% average return over the S&P 500 and a 50% success rate.
On the other hand, on May 12 Credit Suisse analyst Christian Buss downgraded his rating from Outperform to Neutral and lowered his price target from $185 to $165. He noted, “[he] expect[s] the multiple to remain under pressure for the next 12-months and [he] now view[s] this as a range-bound stock following 18 months of relative underperformance (S&P 500 up 36%, Ralph Lauren Corp (NYSE:RL) down 5%).” Buss has a -2.9% average return over the S&P 500 and a 39% success rate.
RL currently has an analyst consensus of MODERATE BUY.
Carly Forster writes about stock market news. She can be reached at [email protected]