Buying Ralph Lauren Corporation (RL) Stock Is A Smart Move Today?

Ralph Lauren Corporation (NYSE:RL) finished Friday with an addition of $1.64 to close at $123.13, an upside of 1.35 percent. An average of 690,920 shares of common stock have been traded in the last five days. There was a gain of $4.34 in the past week, and it reached a new high 26 times over the past 12 months. The last 20 days have seen an average of 800,840 shares traded, while the 50-day average volume stands at 750,448.

RL stock has increased by 6.46% in the last month. The company shares reached their 1-month lowest point of $109.88 on 10/01/21. With the stock rallying to its 52-week high on 05/10/21, shares of the company touched a low of $65.20 and a high of $142.06 in 52 weeks. It has reached a new high 18 times so far this year and achieved 18.69% or $19.39 in price. In spite of this, the price is down -13.33% from the 52-week high.

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Insider Transactions

81 days have passed since Ralph Lauren Corporation (RL) last reported insider trading activity. Nielsen Jane, who is CFO and COO, most recently acquired $4,233 shares at $129.00 per share on Aug 03. In this transaction, the insider spent $546,057. EVP, Chief Commercial Officer, Smith Andrew Howard, disposed of 6,212 shares at a price of $125.00 on May 27. The insider now owns more than $776,500 worth of shares. Prior to that, CFO and COO Nielsen Jane went on to Sale 14,389 shares at $129.00 each on Apr 27. An amount of $1,856,181 was transacted.

Valuation Metrics

Ralph Lauren Corporation (RL) has a trailing price-to-earnings (P/E) ratio of 50.48, which compares with the 15.40 for the broader industry and 32.04 for the sector. In the last five years, Ralph Lauren Corporation’s PE ratio has ranged between 104.74 and 7.596. The stock’s beta is 1.50. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 1.70, the price-to-book (PB) ratio at 3.34, and the price-to-cash flow ratio at 15.38.

Ralph Lauren Corporation pays a $2.75 dividend per share annually. It offers a dividend yield of 2.23%. The company has a payout ratio of 59.20%. The company’s most recent quarterly dividend payment took place on Oct. 8, and it was $0.6875 a share, without any change from last year. Its dividend has been increased for the last 1 year with the latest decrease dividend $0.0005 reported on Friday December 13 2019.Dividends have grown by -65.63% each year over the last three years.

The quick ratio of Ralph Lauren Corporation for the three months ended June 29 was 1.70, and the current ratio was 2.10, indicating that the company is able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 0.55 and a total debt to equity ratio of 0.74 for the quarter ending June 29. Ralph Lauren Corporation’s EBITDA margin for the year ending June 29 is 10.13%, while its operating margin for the same period stands at 6.50%. Its gross profit as reported stood at $2.86 billion compared to revenue of $4.4 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, Ralph Lauren Corporation’s return on assets was 2.20%. For the broader industry, ROE averaged 9.42 over the past year.

Earnings Surprise

For the three-month period that ended June 29, Ralph Lauren Corporation had $368.0 million in cash and short-term investments compared to $1.14 billion in total debt. In the quarter under review, the net income was up than the previous quarter. The company posted a net income of $164.7 million in the quarter, while revenues of -$74.1 million were grew 177.53%. The analyst consensus anticipated Ralph Lauren Corporation’s latest quarter earnings to come in at $0.88 per share, but it turned out to be $2.29, a 160.20% surprise. For the quarter, EBITDA amounted to $277.8 million. Shareholders own equity worth $73.51 million.

Technical Picture

From a technical analysis perspective, let’s take a brief look at Ralph Lauren Corporation (RL) price momentum. RSI 9-day as of the close on 22 October was 68.29%, suggesting the stock is Neutral, with historical volatility in this time frame at 20.01%.

As of today, RL’s price is $120.24 +3.65% or $4.34 from its 5-day moving average. RL is currently trading +5.72% higher than its 20-day SMA and +0.17% higher than its 100-day SMA. However, the stock’s current price level is -0.87% below the SMA50 and +9.76% above the SMA200.

The stochastic %K and %D were 83.69% and 76.55%, respectively, and the average true range (ATR) was 3.43. With the 14-day stochastic at 92.22% and the average true range at 3.52, the RSI (14) stands at 62.24%. The stock has reached 2.30 on the 9-day MACD Oscillator while the 14-day reading was at 3.54.

Analyst Ratings

Wedbush launched coverage on Ralph Lauren Corporation (NYSE: RL) in its analyst report released on October 05, 2021. The firm assigned the stock a an Outperform rating. The consensus rating for Ralph Lauren Corporation (RL) among analysts is Overweight. According to current brokerage recommendations, 0 brokerage firms advise that investors sell RL, while 11 suggest investors hold. There are 0 analysts who rate the stock as underweight. The stock is rated overweight by 1 analysts, while 10 others rate it as a “buy”.

What is RL’s price target for the next 12 months?

Analysts predict a range of price targets between $110.00 and $179.00, with a median target of $140.00. Taking a look at these predictions, the average price target given by analysts for Ralph Lauren Corporation (RL) stock is $141.55.


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