Ralph Lauren (RL) Stock Forecast & Price Target

Ralph Lauren Corp. demonstrated strong financial performance with a notable 18% increase in wholesale, aided by healthy underlying demand and strategic timing of shipments. The company achieved significant consumer engagement, gaining 1.5 million new direct-to-consumer shoppers year-over-year, while its core products, which account for over 70% of the business, showed robust growth in key categories. Additionally, improved operating margins are anticipated, projected to expand by 60 to 80 basis points, supported by expense leverage, alongside a remarkable 26% contribution from digital sales, illustrating the brand’s successful adaptation to market trends.

Ralph Lauren Corp. is facing significant challenges that contribute to a negative outlook on its stock, including anticipated pressure on gross margins in fiscal fourth quarter (FQ4) due to tariffs and a weaker sales performance, particularly in North America, which accounted for 42% of last year's FQ4 sales. The company has lowered its expectations for revenue growth, forecasting only low-single-digit increases in North America as it navigates macroeconomic pressures and consumer caution, alongside strategic reductions in off-price sales. Additionally, while there are positive trends in some areas, the overall guidance for fiscal year 2026 remains conservative, reflecting management's concerns about potential consumer headwinds and increased retail prices across the industry.