On Friday, May 23, UBS analyst Jay Sole raised the price target on Ralph Lauren Corporation (NYSE:RL) from $335 to $384 and maintained a “Buy” rating.
This change comes after the company’s recent Q4 fiscal 2025 earnings report, which Sole sees as a reason to have an improved outlook on the company’s performance over the next 12 months.
A man and woman in business attire walking down a street, bags of clothing in hand.
The analyst is optimistic because he expects Ralph Lauren Corporation to report positive EPS surprises that can result in upward revisions in sell-side EPS estimates and a possible price-to-earnings (P/E) expansion. Sole believes these EPS beats can help the market see the important changes that the company has made in its brand image, distribution model, and cost structure.
Additionally, Sole noted that Ralph Lauren Corporation’s upcoming Investor Day in September could spark more interest in the stock. He also noted that the stock seems cheap right now, trading at approximately 20 times the forecasted EPS for the fiscal year after next. This is based on UBS’ projection that Ralph Lauren Corporation will grow its EPS at a compound annual growth rate of 8.5% over the next five years. This suggests an attractive balance of risk and reward for investors.
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