RALPH LAUREN CORP (RL) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:RL - US7512121010 - Common Stock
369.81 USD
+4.74 (+1.3%)
369.7 USD
-0.11 (-0.03%)
Taking everything into account, RL scores 7 out of 10 in our fundamental rating. RL was compared to 45 industry peers in the Textiles, Apparel & Luxury Goods industry. RL scores excellent points on both the profitability and health parts. This is a solid base for a good stock. RL has a correct valuation and a medium growth rate. This makes RL very considerable for quality investing!
1. Profitability
1.1 Basic Checks
In the past year RL was profitable.
RL had a positive operating cash flow in the past year.
RL had positive earnings in 4 of the past 5 years.
RL had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 11.63%, RL belongs to the top of the industry, outperforming 91.11% of the companies in the same industry.
RL has a better Return On Equity (33.08%) than 88.89% of its industry peers.
Looking at the Return On Invested Capital, with a value of 16.88%, RL belongs to the top of the industry, outperforming 86.67% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for RL is above the industry average of 11.59%.
The last Return On Invested Capital (16.88%) for RL is above the 3 year average (13.65%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.63% | ||
| ROE | 33.08% | ||
| ROIC | 16.88% |
ROA(3y)9.34%
ROA(5y)6.85%
ROE(3y)25.53%
ROE(5y)19.12%
ROIC(3y)13.65%
ROIC(5y)11.13%
1.3 Margins
RL's Profit Margin of 11.28% is amongst the best of the industry. RL outperforms 91.11% of its industry peers.
In the last couple of years the Profit Margin of RL has grown nicely.
Looking at the Operating Margin, with a value of 15.22%, RL belongs to the top of the industry, outperforming 86.67% of the companies in the same industry.
In the last couple of years the Operating Margin of RL has grown nicely.
With an excellent Gross Margin value of 69.22%, RL belongs to the best of the industry, outperforming 95.56% of the companies in the same industry.
In the last couple of years the Gross Margin of RL has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.22% | ||
| PM (TTM) | 11.28% | ||
| GM | 69.22% |
OM growth 3Y1.83%
OM growth 5Y16.31%
PM growth 3Y2.83%
PM growth 5Y10.96%
GM growth 3Y0.92%
GM growth 5Y2.93%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so RL is still creating some value.
RL has less shares outstanding than it did 1 year ago.
The number of shares outstanding for RL has been reduced compared to 5 years ago.
RL has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 6.19 indicates that RL is not in any danger for bankruptcy at the moment.
RL's Altman-Z score of 6.19 is amongst the best of the industry. RL outperforms 91.11% of its industry peers.
The Debt to FCF ratio of RL is 2.22, which is a good value as it means it would take RL, 2.22 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of RL (2.22) is better than 77.78% of its industry peers.
RL has a Debt/Equity ratio of 0.57. This is a neutral value indicating RL is somewhat dependend on debt financing.
RL's Debt to Equity ratio of 0.57 is on the low side compared to the rest of the industry. RL is outperformed by 64.44% of its industry peers.
Even though the debt/equity ratio score it not favorable for RL, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.57 | ||
| Debt/FCF | 2.22 | ||
| Altman-Z | 6.19 |
ROIC/WACC1.5
WACC11.22%
2.3 Liquidity
RL has a Current Ratio of 2.04. This indicates that RL is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of RL (2.04) is comparable to the rest of the industry.
RL has a Quick Ratio of 1.35. This is a normal value and indicates that RL is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.35, RL is in the better half of the industry, outperforming 68.89% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.04 | ||
| Quick Ratio | 1.35 |
3. Growth
3.1 Past
RL shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 31.74%, which is quite impressive.
The Earnings Per Share has been growing by 13.66% on average over the past years. This is quite good.
RL shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 12.32%.
Measured over the past years, RL shows a small growth in Revenue. The Revenue has been growing by 2.82% on average per year.
EPS 1Y (TTM)31.74%
EPS 3Y13.92%
EPS 5Y13.66%
EPS Q2Q%49.21%
Revenue 1Y (TTM)12.32%
Revenue growth 3Y4.41%
Revenue growth 5Y2.82%
Sales Q2Q%16.49%
3.2 Future
Based on estimates for the next years, RL will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.21% on average per year.
The Revenue is expected to grow by 4.92% on average over the next years.
EPS Next Y28.71%
EPS Next 2Y18.51%
EPS Next 3Y16.36%
EPS Next 5Y10.21%
Revenue Next Year10.44%
Revenue Next 2Y7.7%
Revenue Next 3Y6.85%
Revenue Next 5Y4.92%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 25.24, which means the current valuation is very expensive for RL.
The rest of the industry has a similar Price/Earnings ratio as RL.
RL is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.19, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 21.36, the valuation of RL can be described as rather expensive.
RL's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of RL to the average of the S&P500 Index (23.92), we can say RL is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.24 | ||
| Fwd PE | 21.36 |
4.2 Price Multiples
60.00% of the companies in the same industry are cheaper than RL, based on the Enterprise Value to EBITDA ratio.
RL's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 33.59 | ||
| EV/EBITDA | 16.05 |
4.3 Compensation for Growth
RL's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
RL has an outstanding profitability rating, which may justify a higher PE ratio.
RL's earnings are expected to grow with 16.36% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.88
PEG (5Y)1.85
EPS Next 2Y18.51%
EPS Next 3Y16.36%
5. Dividend
5.1 Amount
RL has a yearly dividend return of 1.00%, which is pretty low.
Compared to an average industry Dividend Yield of 1.46, RL has a dividend in line with its industry peers.
With a Dividend Yield of 1.00, RL pays less dividend than the S&P500 average, which is at 1.92.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1% |
5.2 History
The dividend of RL has a limited annual growth rate of 3.54%.
RL has paid a dividend for at least 10 years, which is a reliable track record.
RL has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)3.54%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
24.37% of the earnings are spent on dividend by RL. This is a low number and sustainable payout ratio.
The dividend of RL is growing, but earnings are growing more, so the dividend growth is sustainable.
DP24.37%
EPS Next 2Y18.51%
EPS Next 3Y16.36%
369.81
+4.74 (+1.3%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryTextiles, Apparel & Luxury Goods
Earnings (Last)
Earnings (Next)
Inst Owners101.16%
Inst Owner Change0.25%
Ins Owners3.54%
Ins Owner Change-0.3%
Market Cap22.43B
Revenue(TTM)7.57B
Net Income(TTM)854.30M
Analysts82.22
Price Target381.64 (3.2%)
Short Float %4.59%
Short Ratio2.61
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1% |
Yearly Dividend3.22
Dividend Growth(5Y)3.54%
DP24.37%
Div Incr Years4
Div Non Decr Years4
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.8%
Min EPS beat(2)4.63%
Max EPS beat(2)6.97%
EPS beat(4)4
Avg EPS beat(4)6.44%
Min EPS beat(4)4.24%
Max EPS beat(4)9.93%
EPS beat(8)7
Avg EPS beat(8)6.07%
EPS beat(12)11
Avg EPS beat(12)9.5%
EPS beat(16)15
Avg EPS beat(16)11.6%
Revenue beat(2)2
Avg Revenue beat(2)2.05%
Min Revenue beat(2)0.77%
Max Revenue beat(2)3.32%
Revenue beat(4)4
Avg Revenue beat(4)1.89%
Min Revenue beat(4)0.14%
Max Revenue beat(4)3.35%
Revenue beat(8)5
Avg Revenue beat(8)0.51%
Revenue beat(12)7
Avg Revenue beat(12)0.28%
Revenue beat(16)10
Avg Revenue beat(16)0.81%
PT rev (1m)2%
PT rev (3m)9.7%
EPS NQ rev (1m)0.1%
EPS NQ rev (3m)8.18%
EPS NY rev (1m)0.07%
EPS NY rev (3m)3.48%
Revenue NQ rev (1m)0.04%
Revenue NQ rev (3m)3.62%
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)2.34%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.24 | ||
| Fwd PE | 21.36 | ||
| P/S | 2.96 | ||
| P/FCF | 33.59 | ||
| P/OCF | 20.58 | ||
| P/B | 8.68 | ||
| P/tB | 13.9 | ||
| EV/EBITDA | 16.05 |
EPS(TTM)14.65
EY3.96%
EPS(NY)17.32
Fwd EY4.68%
FCF(TTM)11.01
FCFY2.98%
OCF(TTM)17.97
OCFY4.86%
SpS124.84
BVpS42.58
TBVpS26.61
PEG (NY)0.88
PEG (5Y)1.85
Graham Number118.48
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.63% | ||
| ROE | 33.08% | ||
| ROCE | 20.93% | ||
| ROIC | 16.88% | ||
| ROICexc | 24.07% | ||
| ROICexgc | 32.12% | ||
| OM | 15.22% | ||
| PM (TTM) | 11.28% | ||
| GM | 69.22% | ||
| FCFM | 8.82% |
ROA(3y)9.34%
ROA(5y)6.85%
ROE(3y)25.53%
ROE(5y)19.12%
ROIC(3y)13.65%
ROIC(5y)11.13%
ROICexc(3y)21.58%
ROICexc(5y)18.48%
ROICexgc(3y)31.01%
ROICexgc(5y)27.05%
ROCE(3y)16.93%
ROCE(5y)13.8%
ROICexgc growth 3Y5.94%
ROICexgc growth 5Y26.51%
ROICexc growth 3Y6.82%
ROICexc growth 5Y25.11%
OM growth 3Y1.83%
OM growth 5Y16.31%
PM growth 3Y2.83%
PM growth 5Y10.96%
GM growth 3Y0.92%
GM growth 5Y2.93%
F-Score8
Asset Turnover1.03
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.57 | ||
| Debt/FCF | 2.22 | ||
| Debt/EBITDA | 1.06 | ||
| Cap/Depr | 190.35% | ||
| Cap/Sales | 5.58% | ||
| Interest Coverage | 28.32 | ||
| Cash Conversion | 79.3% | ||
| Profit Quality | 78.16% | ||
| Current Ratio | 2.04 | ||
| Quick Ratio | 1.35 | ||
| Altman-Z | 6.19 |
F-Score8
WACC11.22%
ROIC/WACC1.5
Cap/Depr(3y)89.69%
Cap/Depr(5y)77.05%
Cap/Sales(3y)2.97%
Cap/Sales(5y)2.81%
Profit Quality(3y)104.73%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)31.74%
EPS 3Y13.92%
EPS 5Y13.66%
EPS Q2Q%49.21%
EPS Next Y28.71%
EPS Next 2Y18.51%
EPS Next 3Y16.36%
EPS Next 5Y10.21%
Revenue 1Y (TTM)12.32%
Revenue growth 3Y4.41%
Revenue growth 5Y2.82%
Sales Q2Q%16.49%
Revenue Next Year10.44%
Revenue Next 2Y7.7%
Revenue Next 3Y6.85%
Revenue Next 5Y4.92%
EBIT growth 1Y32.83%
EBIT growth 3Y6.32%
EBIT growth 5Y19.59%
EBIT Next Year47.21%
EBIT Next 3Y19.71%
EBIT Next 5Y12.28%
FCF growth 1Y24.41%
FCF growth 3Y22.89%
FCF growth 5Y16.04%
OCF growth 1Y44.8%
OCF growth 3Y19.94%
OCF growth 5Y10.36%
RALPH LAUREN CORP / RL FAQ
What is the ChartMill fundamental rating of RALPH LAUREN CORP (RL) stock?
ChartMill assigns a fundamental rating of 7 / 10 to RL.
What is the valuation status of RALPH LAUREN CORP (RL) stock?
ChartMill assigns a valuation rating of 4 / 10 to RALPH LAUREN CORP (RL). This can be considered as Fairly Valued.
How profitable is RALPH LAUREN CORP (RL) stock?
RALPH LAUREN CORP (RL) has a profitability rating of 9 / 10.
What are the PE and PB ratios of RALPH LAUREN CORP (RL) stock?
The Price/Earnings (PE) ratio for RALPH LAUREN CORP (RL) is 25.24 and the Price/Book (PB) ratio is 8.68.
What is the financial health of RALPH LAUREN CORP (RL) stock?
The financial health rating of RALPH LAUREN CORP (RL) is 7 / 10.