Ralph Lauren (RL) Stock Forecast & Price Target

Ralph Lauren Corp. has demonstrated strong financial performance, highlighted by an 18% increase in wholesale revenue, largely due to healthy underlying demand and strategic timing of shipments. The company has successfully attracted 1.5 million new direct-to-consumer shoppers year-over-year, reflecting growth in its core authentic products and high-potential categories such as women's apparel and handbags. Additionally, the projected expansion of operating margin and a significant rise in average unit retail (AUR) indicate effective expense management and pricing strategies, supporting the company's positive revenue growth outlook for FY26.

Ralph Lauren Corp. is facing significant challenges with expected gross margin pressure in the upcoming fourth fiscal quarter due to tariffs, timing shifts, and difficult comparisons from the prior year, which could adversely impact revenue. The company's sales in North America, accounting for a substantial portion of quarterly sales, are anticipated to decline, reflecting a cautious outlook amid potential macroeconomic headwinds and consumer spending apprehensions. Additionally, while there are signs of positive sell-through trends, management's strategic reduction in off-price exposure and cautious guidance for fiscal year 2026 signals a more tempered growth expectation.