Ralph Lauren Corporation

Ralph Lauren Corporation NYSE
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Important events

Mar 082022

Ralph Lauren shrinks in the wash

Ralph Lauren sold-off in the face of increasing pessimism about growth in the European retail market as violence in Ukraine continues.

🔍 Key points:

  • Wedbush analyst Tom Nikic has downgraded Ralph Lauren to Neutral, cutting the price target on the stock to $127 from $150, and has cut its target on PVH (which owns brands like Tommy Hilfiger and Calvin Klein) to $85 from $140.
  • Nikic joins other analysts in seeing war-related headwinds for those retailers relying heavily on growth in their European markets this year. He says “it’s becoming increasingly likely that the war could spill over into consumer sentiment”, making that growth seem somewhat ambitious for the foreseeable future.
  • Ralph Lauren shares lost over 12% on Monday to hit their lowest level since January 2021, and PVH fell over 15% to a 15-month low. European sales account for around 28% of Ralph Lauren revenue, and around 45% for PVH, so the bearish comments have rattled investors.
Tina Bosse / Unsplash

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Feb 242022

LVMH tries Ralph Lauren on for size

Ralph Lauren stood a little taller on the market runway following reports that it's been talking to luxury goods giant LVMH (LVMH).

Key points:
  • LVMH has reportedly had numerous talks with Ralph Lauren about a potential “acquisition” of the brand. Both are among the industry’s most luxurious names and any deal they strike would likely be the largest of its kind – prices gained 5% on the news before closing down 0.4%.
  • High end apparel sales have been soaring recently, with Ralph Lauren joining luxury goods retailers in topping estimates for the holiday quarter – so it’s not like they need to be acquired. But, as Ralph himself considers his succession plans, such a high-end company could be the perfect custodian of his empire.
  • Given the brand's value, it would likely send prices soaring for LVMH, which has been on an acquisition streak lately – the company acquired Christian Dior for $13.1bn in 2017, and in 2019 it bought Tiffany & Co in a $16bn deal.
Hayffield L / Unsplash