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Ralph Lauren Stock Surges 61% in a Year: Is it Too Late to Buy?
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Ralph Lauren Corporation (RL - Free Report) has demonstrated an impressive stock market rally in the past year, thanks to strong brand equity, a diversified growth strategy and strength in the direct-to-consumer channel. Being a well-known name in the premium lifestyle products market, Ralph Lauren’s market position is defined by its strong heritage, aspirational image, and successful penetration into both luxury and mid-tier markets.
These efforts, combined with consistent innovation and a focus on quality, reinforce RL’s standing as a leading player in the global fashion industry while aligning its brand with contemporary consumer values.
Backed by its perseverance, the New York-based company has gained significant momentum, outperforming its textile apparel industry peers, the broader sector and the S&P 500 index in 2024. Shares of Ralph Lauren have surged 61.4% in the past year against the industry's decline of 5.2%. The stock has also outperformed the broader Zacks Consumer Discretionary sector and the S&P 500's respective growth of 12% and 24.4% in the same period.
RL Stock One-Year Price Performance
Image Source: Zacks Investment Research
At the current price of $234.49, the Ralph Lauren stock trades closer to its 52-week high of $237.16 reached on Nov. 7, 2024. The current stock price reflects only a 1.1% discount from its 52-week high mark. This indicates that the stock has further upside potential.
RL trades above its 50 and 200-day moving averages, indicating robust upward momentum and price stability. This technical strength reflects positive market perception, and confidence in Ralph Lauren’s financial health and prospects.
Ralph Lauren Stock Trades Above 50 & 200-Day Moving Averages
Image Source: Zacks Investment Research
RL’s Journey to Success: Growth Initiatives Yield Results
The Ralph Lauren stock’s upward trajectory is well-supported by its global brand portfolio and continuous investments in business development. The company is on track to surpass its top and bottom-line targets under the “Next Great Chapter: Accelerate Plan.” This initiative focuses on simplifying the global organizational structure and enhancing technological capabilities. As part of this strategy, Ralph Lauren transitioned Chaps to a licensed business, completing its portfolio realignment.
The company’s focus on product elevation, personalized and targeted promotions, disciplined inventory management, and a favorable channel and geographic mix positions it for continued success.
Ralph Lauren also actively invests in digital transformation, sustainable practices and targeted marketing strategies. Its initiatives include expanding e-commerce platforms, leveraging AI for customer personalization, and committing to eco-friendly materials and supply-chain transparency through the "Design the Change" program. The company also emphasizes geographic expansion, particularly in Asia and emerging markets, to capture growth opportunities.
Ralph Lauren’s management remains confident in maintaining business momentum and executing its long-term strategy to elevate the brand and strengthen its market position during the holiday season.
For the third quarter of fiscal 2025, the company expects revenue growth of 3-4% on a constant-currency basis, driven by its direct-to-consumer (DTC) channels. This includes a positive foreign currency impact of approximately 10-50 basis points (bps). For fiscal 2025, Ralph Lauren forecasts year-over-year revenue growth of 3-4%, led by robust performances in DTC channels and international markets, fueled by solid consumer demand and strategic investments.
RL Earnings Estimates Reflect Positive Trend
Analysts seem quite optimistic about Ralph Lauren. The Zacks Consensus Estimate for its fiscal 2025 earnings per share (EPS) has increased 0.3% in the past 30 days. The consensus estimate for fiscal 2026 EPS has moved up by a penny in the past seven days.
For fiscal 2025, the Zacks Consensus Estimate for RL’s sales and EPS implies 3.6% and 13.9% year-over-year growth, respectively. For fiscal 2026, the consensus mark for sales and EPS indicates 4.3% and 11.7% year-over-year increases, respectively.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Is Ralph Lauren Stock's Premium Valuation Justified?
RL is currently trading at a significant premium to its industry peers on a forward 12-month price-to-earnings (P/E) ratio. Its forward 12-month P/E ratio of 18.44X is above its five-year median of 14.54X and exceeds the broader industry’s multiple of 14.29X. This suggests that RL’s shares are somewhat expensive on a relative basis.
While this might be perceived as a risk, the premium is justified due to Ralph Lauren’s consistent financial performance and growth prospects, driven by the success of its “Next Great Chapter: Accelerate Plan” and strategic focus on key products.
Is it Too Late to Buy RL Stock?
Ralph Lauren’s solid price momentum demonstrates its resilience and growth potential, backed by exceptional financial health, digital initiatives, long-term strategies and operational efficiency. These positive traits suggest adding the stock right away to one's portfolio. Given the pricey valuation and the stock’s recent rally, new investors with lesser risk appetite may prefer to wait for the stock to retract some of its recent gains, providing a better entry point.
An optimistic forward outlook and upward revisions in earnings estimates show promise. Ralph Lauren is well-positioned for sustained long-term growth, making it a stock worth considering for investors seeking opportunities in the sector. The company currently carries a Zacks Rank #2 (Buy).
Other Apparel Stocks to Consider
We have highlighted three other top-ranked stocks, namely, Under Armour (UAA - Free Report) , lululemon athletica inc. (LULU - Free Report) and G-III Apparel Group (GIII - Free Report) .
Under Armour is one of the leading designers, marketers, and distributors of authentic athletic footwear, apparel, and accessories for a wide variety of sports and fitness activities in the United States and internationally. It flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today's Zacks #1 Rank stocks here.
The consensus estimate for Under Armour’s fiscal 2025 sales and EPS indicates declines of 10.6% and 50%, respectively, from the year-ago reported figures. UAA has a trailing four-quarter earnings surprise of 75.1%, on average.
lululemon is a yoga-inspired athletic apparel company that creates lifestyle components. It carries a Zacks Rank of 2 at present.
The Zacks Consensus Estimate for lululemon’s fiscal 2024 sales and EPS indicates growth of 10% and 11%, respectively, from the year-ago actuals. LULU has a trailing four-quarter earnings surprise of 6.7%, on average.
G-III Apparel is a manufacturer, designer, and distributor of apparel and accessories under licensed brands, owned brands and private label brands. It has a Zacks Rank #2 at present.
GIII has a trailing four-quarter earnings surprise of 113.4%, on average. The Zacks Consensus Estimate for the company’s fiscal 2024 sales and EPS indicates growth of 1.7% and 3%, respectively, from the year-ago reported figures.
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Ralph Lauren Stock Surges 61% in a Year: Is it Too Late to Buy?
Ralph Lauren Corporation (RL - Free Report) has demonstrated an impressive stock market rally in the past year, thanks to strong brand equity, a diversified growth strategy and strength in the direct-to-consumer channel. Being a well-known name in the premium lifestyle products market, Ralph Lauren’s market position is defined by its strong heritage, aspirational image, and successful penetration into both luxury and mid-tier markets.
These efforts, combined with consistent innovation and a focus on quality, reinforce RL’s standing as a leading player in the global fashion industry while aligning its brand with contemporary consumer values.
Backed by its perseverance, the New York-based company has gained significant momentum, outperforming its textile apparel industry peers, the broader sector and the S&P 500 index in 2024. Shares of Ralph Lauren have surged 61.4% in the past year against the industry's decline of 5.2%. The stock has also outperformed the broader Zacks Consumer Discretionary sector and the S&P 500's respective growth of 12% and 24.4% in the same period.
RL Stock One-Year Price Performance
Image Source: Zacks Investment Research
At the current price of $234.49, the Ralph Lauren stock trades closer to its 52-week high of $237.16 reached on Nov. 7, 2024. The current stock price reflects only a 1.1% discount from its 52-week high mark. This indicates that the stock has further upside potential.
RL trades above its 50 and 200-day moving averages, indicating robust upward momentum and price stability. This technical strength reflects positive market perception, and confidence in Ralph Lauren’s financial health and prospects.
Ralph Lauren Stock Trades Above 50 & 200-Day Moving Averages
Image Source: Zacks Investment Research
RL’s Journey to Success: Growth Initiatives Yield Results
The Ralph Lauren stock’s upward trajectory is well-supported by its global brand portfolio and continuous investments in business development. The company is on track to surpass its top and bottom-line targets under the “Next Great Chapter: Accelerate Plan.” This initiative focuses on simplifying the global organizational structure and enhancing technological capabilities. As part of this strategy, Ralph Lauren transitioned Chaps to a licensed business, completing its portfolio realignment.
The company’s focus on product elevation, personalized and targeted promotions, disciplined inventory management, and a favorable channel and geographic mix positions it for continued success.
Ralph Lauren also actively invests in digital transformation, sustainable practices and targeted marketing strategies. Its initiatives include expanding e-commerce platforms, leveraging AI for customer personalization, and committing to eco-friendly materials and supply-chain transparency through the "Design the Change" program. The company also emphasizes geographic expansion, particularly in Asia and emerging markets, to capture growth opportunities.
Ralph Lauren’s management remains confident in maintaining business momentum and executing its long-term strategy to elevate the brand and strengthen its market position during the holiday season.
For the third quarter of fiscal 2025, the company expects revenue growth of 3-4% on a constant-currency basis, driven by its direct-to-consumer (DTC) channels. This includes a positive foreign currency impact of approximately 10-50 basis points (bps). For fiscal 2025, Ralph Lauren forecasts year-over-year revenue growth of 3-4%, led by robust performances in DTC channels and international markets, fueled by solid consumer demand and strategic investments.
RL Earnings Estimates Reflect Positive Trend
Analysts seem quite optimistic about Ralph Lauren. The Zacks Consensus Estimate for its fiscal 2025 earnings per share (EPS) has increased 0.3% in the past 30 days. The consensus estimate for fiscal 2026 EPS has moved up by a penny in the past seven days.
For fiscal 2025, the Zacks Consensus Estimate for RL’s sales and EPS implies 3.6% and 13.9% year-over-year growth, respectively. For fiscal 2026, the consensus mark for sales and EPS indicates 4.3% and 11.7% year-over-year increases, respectively.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Is Ralph Lauren Stock's Premium Valuation Justified?
RL is currently trading at a significant premium to its industry peers on a forward 12-month price-to-earnings (P/E) ratio. Its forward 12-month P/E ratio of 18.44X is above its five-year median of 14.54X and exceeds the broader industry’s multiple of 14.29X. This suggests that RL’s shares are somewhat expensive on a relative basis.
While this might be perceived as a risk, the premium is justified due to Ralph Lauren’s consistent financial performance and growth prospects, driven by the success of its “Next Great Chapter: Accelerate Plan” and strategic focus on key products.
Is it Too Late to Buy RL Stock?
Ralph Lauren’s solid price momentum demonstrates its resilience and growth potential, backed by exceptional financial health, digital initiatives, long-term strategies and operational efficiency. These positive traits suggest adding the stock right away to one's portfolio. Given the pricey valuation and the stock’s recent rally, new investors with lesser risk appetite may prefer to wait for the stock to retract some of its recent gains, providing a better entry point.
An optimistic forward outlook and upward revisions in earnings estimates show promise. Ralph Lauren is well-positioned for sustained long-term growth, making it a stock worth considering for investors seeking opportunities in the sector. The company currently carries a Zacks Rank #2 (Buy).
Other Apparel Stocks to Consider
We have highlighted three other top-ranked stocks, namely, Under Armour (UAA - Free Report) , lululemon athletica inc. (LULU - Free Report) and G-III Apparel Group (GIII - Free Report) .
Under Armour is one of the leading designers, marketers, and distributors of authentic athletic footwear, apparel, and accessories for a wide variety of sports and fitness activities in the United States and internationally. It flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today's Zacks #1 Rank stocks here.
The consensus estimate for Under Armour’s fiscal 2025 sales and EPS indicates declines of 10.6% and 50%, respectively, from the year-ago reported figures. UAA has a trailing four-quarter earnings surprise of 75.1%, on average.
lululemon is a yoga-inspired athletic apparel company that creates lifestyle components. It carries a Zacks Rank of 2 at present.
The Zacks Consensus Estimate for lululemon’s fiscal 2024 sales and EPS indicates growth of 10% and 11%, respectively, from the year-ago actuals. LULU has a trailing four-quarter earnings surprise of 6.7%, on average.
G-III Apparel is a manufacturer, designer, and distributor of apparel and accessories under licensed brands, owned brands and private label brands. It has a Zacks Rank #2 at present.
GIII has a trailing four-quarter earnings surprise of 113.4%, on average. The Zacks Consensus Estimate for the company’s fiscal 2024 sales and EPS indicates growth of 1.7% and 3%, respectively, from the year-ago reported figures.