Ralph Lauren Corporation designs, markets, and distributes lifestyle products in four categories: apparel, home, accessories and fragrances. The company was founded in 1967 and is based in New York, New York.
RL Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Ralph Lauren Corp with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Ralph Lauren Corp ranked in the 14th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 84.83%. In terms of the factors that were most noteworthy in this DCF analysis for RL, they are:
Its compound free cash flow growth rate, as measured over the past 5.76 years, is -0.1% -- higher than only 13.83% of stocks in our DCF forecasting set.
Ralph Lauren Corp's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at -7.23. This coverage rate is greater than that of merely 10.57% of stocks we're observing for the purpose of forecasting via discounted cash flows.
As a business, Ralph Lauren Corp experienced a tax rate of about 44% over the past twelve months; relative to its sector (Consumer Cyclical), this tax rate is higher than 89.96% of stocks generating free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of Ralph Lauren Corp? See DIN, LEA, MTN, ROST, and BFAM.
In an unsurprising move, Ralph Lauren (RL) says it will trim its workforce as part of a structural change to adapt to a higher mix of a online sales."The changes happening in the world around us have accelerated the shifts we saw pre-Covid, and we are fast-tracking some of our...