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On Thursday, Needham analysts maintained their positive stance on Ralph Lauren (NYSE:RL) shares, reiterating a Buy rating and a price target of $310.00. The endorsement follows Ralph Lauren’s announcement of robust fourth-quarter financial results for fiscal year 2025 and what was described as conservative future earnings guidance. According to InvestingPro data, the company maintains a "GREAT" financial health score of 3.24, with 7 analysts recently revising their earnings estimates upward.
The company’s latest earnings report exceeded expectations, with a revenue increase of 10% on a constant-FX basis, surpassing the projected 6-7% growth. Earnings per share (EPS) also topped estimates, coming in at $2.27 compared to the Street’s anticipation of $2.04. Ralph Lauren’s financial position was highlighted as particularly strong, with nearly $1 billion in net cash. The company boasts impressive gross profit margins of 68.08% and has maintained dividend payments for 23 consecutive years. InvestingPro’s Fair Value analysis suggests the stock is currently trading slightly above its intrinsic value.
Looking ahead to fiscal year 2026, Ralph Lauren plans for low single-digit revenue growth and modest margin expansion. The first quarter is expected to show high single-digit revenue growth and a significant improvement in EBIT margin, increasing by 150-200 basis points. However, the company’s guidance suggests a slowdown to low single-digit revenue growth for the rest of the year and a potential decrease in EBIT margin in the second half, which analysts believe could be a conservative forecast. The company’s strong performance is reflected in its impressive 69.51% return over the past year, with a PEG ratio of 0.98 suggesting reasonable valuation relative to growth.
Analysts at Needham expressed confidence that Ralph Lauren can generate high-quality, double-digit EPS growth in the coming years. They pointed to the brand’s global appeal, its ability to manage tariffs through eight consecutive years of average unit retail (AUR) growth, and the conservative nature of the company’s FY26 guidance, which they believe sets the stage for potential upward revisions. For deeper insights into Ralph Lauren’s financial health and growth prospects, including 15+ additional ProTips and comprehensive valuation metrics, visit InvestingPro for the full research report.
In other recent news, Ralph Lauren Corp. reported impressive financial results for the fourth quarter of 2025, significantly exceeding Wall Street’s expectations. The company posted an earnings per share of $2.27, surpassing the projected $2.04, while revenue reached $1.7 billion, higher than the anticipated $1.64 billion. This strong performance was attributed to robust sales growth and strategic operational adjustments, particularly in international markets like China. Furthermore, Ralph Lauren achieved a 10% increase in total company revenue, with international operations now accounting for 57% of total revenues. The company’s adjusted gross margin expanded by 260 basis points to 69.2%, showcasing effective cost management and pricing strategies. Analyst firms have noted the company’s continued focus on product innovation and market expansion as key drivers of its success. Ralph Lauren anticipates low single-digit revenue growth for fiscal 2026, with particular strength expected in the first half of the year.
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