Ralph Lauren Earnings: Brand Investments Lead to Stellar Results in a Tough Market; Shares Pricey

Ralph Lauren’s shares soared 17% on Feb. 8 after it reported fiscal 2024 third-quarter sales and earnings above our expectations. We attribute the solid results in a difficult apparel market to the power of the company’s brand, the source of our narrow-moat rating. We expect to lift our $132 fair value estimate by a mid-single-digit percentage, but now rate Ralph Lauren’s shares as overvalued after their sharp rise over the past three months.