Analysts have recommended buying Ralph Lauren stock. They see potential in the EU and China

Raymond James, an investment bank, recommended buying shares of Ralph Lauren, a U.S. premium apparel retailer, upgrading its rating from “Market Perform” (in line with the market) to “Outperform” (outperforming the market). The bank’s analysts set a price target of $410, which implies upside potential of approximately 7% relative to the closing price on July 21.

The luxury company's stock price rose by about 1.7% that day, and has gained approximately 9% since the beginning of the year.

Ralph Lauren is “operating at full capacity,” according to a note from Raymond James cited by CNBC. Sales and brand recognition are gaining momentum, which could soon support the company’s stock growth, analysts at the investment bank predict.

Among the key factors, they cited the stability of the average selling price of goods and the expansion of the operating margin, which should result in earnings above current market estimates. In addition, the bank’s strategists expect Ralph Lauren to further strengthen its position in China—where they believe the brand is still underrepresented compared to traditional luxury brands—as well as to expand its presence in Europe, where the retailer also has room for growth. Raymond James also highlighted the brand’s strength and the high effectiveness of its management.

Last quarter, Ralph Lauren saw an increase in traffic across all distribution channels: traffic to the official website, activity on the mobile app, and Google Trends metrics all rose, according to the report. As a result, analysts believe the company’s financial results could exceed expectations.

Raymond James notes that consensus revenue forecasts for U.S. retailers have improved slightly ahead of the earnings season following strong results in the previous quarter, according to Investing. However, the bank cautioned that uncertainty surrounding import tariffs and the macroeconomic situation will remain one of the key risks for the sector in the second half of the year.

Of the 21 analysts tracking Ralph Lauren stock, 17 recommend buying it, according to MarketWatch data. Three advise holding the stock, and one recommends selling it.

The average target price is $438. This is 14% higher than the closing price on July 21.

This article was AI-translated and verified by a human editor