Ralph Lauren Beats Up on Analysts Yet Again

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Ralph Lauren (NYS: RL) reported earnings on Feb. 8. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q3), Ralph Lauren beat expectations on revenue and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue increased significantly and GAAP earnings per share expanded.

Margins dropped across the board.

Revenue details
Ralph Lauren tallied revenue of $1.81 billion. The 12 analysts polled by S&P Capital IQ looked for net sales of $1.75 billion. GAAP sales were 17% higher than the prior-year quarter's $1.55 billion.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $1.78. The 15 earnings estimates compiled by S&P Capital IQ averaged $1.66 per share. GAAP EPS of $1.78 for Q3 were 3.5% higher than the prior-year quarter's $1.72 per share.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 57.1%, 150 basis points worse than the prior-year quarter. Operating margin was 15.0%, 90 basis points worse than the prior-year quarter. Net margin was 9.4%, 150 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $1.62 billion. On the bottom line, the average EPS estimate is $0.94.

Next year's average estimate for revenue is $6.80 billion. The average EPS estimate is $6.97.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 356 members out of 440 rating the stock outperform, and 84 members rating it underperform. Among 130 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 110 give Ralph Lauren a green thumbs-up, and 20 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Ralph Lauren is outperform, with an average price target of $158.38.

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At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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