Ralph Lauren (RL) delivered a solid fiscal Q4 earnings beat and issued fiscal 2027 guidance that could prompt modest increases in Wall Street earnings estimates, UBS Securities said in a report emailed Friday.
The brokerage said Ralph Lauren's fiscal 2027 earnings-per-share guidance implies a range of $17.87 to $18.49, assuming $500 million in share buybacks, compared with the current "sell-side" consensus estimate of $18.06. Q1 of fiscal 2027 guidance implied EPS of $3.97 to $4.31, versus Wall Street's current forecast of $4.08.
Ralph Lauren posted adjusted fiscal Q4 EPS that exceeded expectations as revenue rose 16.6% year over year to $1.98 billion. Global direct-to-consumer comparable sales increased 17%, while gross margin expanded 105 basis points to 69.7%, the report noted.
The firm also said investor "sentiment" toward the stock is likely to improve, supported by stronger-than-expected sales, margins and earnings in the latest quarter, along with accelerating direct-to-consumer growth in Europe.
UBS maintained a buy rating on Ralph Lauren, with a price target of $480, adding that the company remains one of the "highest quality stocks" in the softlines sector and is better positioned than peers to "navigate choppy global macro trends."
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