RALPH LAUREN CORP (PRL.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:PRL - US7512121010 - Common Stock
296.7 EUR
-14.75 (-4.74%)
Overall PRL gets a fundamental rating of 7 out of 10. We evaluated PRL against 52 industry peers in the Textiles, Apparel & Luxury Goods industry. PRL gets an excellent profitability rating and is at the same time showing great financial health properties. PRL has a decent growth rate and is not valued too expensively. These ratings could make PRL a good candidate for quality investing.
1. Profitability
1.1 Basic Checks
- PRL had positive earnings in the past year.
- PRL had a positive operating cash flow in the past year.
- PRL had positive earnings in 4 of the past 5 years.
- In the past 5 years PRL always reported a positive cash flow from operatings.
1.2 Ratios
- With an excellent Return On Assets value of 11.63%, PRL belongs to the best of the industry, outperforming 84.62% of the companies in the same industry.
- With an excellent Return On Equity value of 33.08%, PRL belongs to the best of the industry, outperforming 88.46% of the companies in the same industry.
- PRL's Return On Invested Capital of 16.88% is amongst the best of the industry. PRL outperforms 82.69% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for PRL is above the industry average of 11.64%.
- The last Return On Invested Capital (16.88%) for PRL is above the 3 year average (13.65%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.63% | ||
| ROE | 33.08% | ||
| ROIC | 16.88% |
ROA(3y)9.34%
ROA(5y)6.85%
ROE(3y)25.53%
ROE(5y)19.12%
ROIC(3y)13.65%
ROIC(5y)11.13%
1.3 Margins
- PRL has a Profit Margin of 11.28%. This is in the better half of the industry: PRL outperforms 71.15% of its industry peers.
- PRL's Profit Margin has improved in the last couple of years.
- PRL's Operating Margin of 15.22% is fine compared to the rest of the industry. PRL outperforms 63.46% of its industry peers.
- In the last couple of years the Operating Margin of PRL has grown nicely.
- The Gross Margin of PRL (69.22%) is better than 67.31% of its industry peers.
- PRL's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.22% | ||
| PM (TTM) | 11.28% | ||
| GM | 69.22% |
OM growth 3Y1.83%
OM growth 5Y16.31%
PM growth 3Y2.83%
PM growth 5Y10.96%
GM growth 3Y0.92%
GM growth 5Y2.93%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), PRL is creating some value.
- Compared to 1 year ago, PRL has less shares outstanding
- Compared to 5 years ago, PRL has less shares outstanding
- Compared to 1 year ago, PRL has an improved debt to assets ratio.
2.2 Solvency
- PRL has an Altman-Z score of 6.20. This indicates that PRL is financially healthy and has little risk of bankruptcy at the moment.
- With an excellent Altman-Z score value of 6.20, PRL belongs to the best of the industry, outperforming 82.69% of the companies in the same industry.
- PRL has a debt to FCF ratio of 2.22. This is a good value and a sign of high solvency as PRL would need 2.22 years to pay back of all of its debts.
- PRL has a Debt to FCF ratio of 2.22. This is amongst the best in the industry. PRL outperforms 80.77% of its industry peers.
- A Debt/Equity ratio of 0.57 indicates that PRL is somewhat dependend on debt financing.
- With a Debt to Equity ratio value of 0.57, PRL perfoms like the industry average, outperforming 53.85% of the companies in the same industry.
- Even though the debt/equity ratio score it not favorable for PRL, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.57 | ||
| Debt/FCF | 2.22 | ||
| Altman-Z | 6.2 |
ROIC/WACC1.51
WACC11.19%
2.3 Liquidity
- PRL has a Current Ratio of 2.04. This indicates that PRL is financially healthy and has no problem in meeting its short term obligations.
- PRL has a better Current ratio (2.04) than 69.23% of its industry peers.
- PRL has a Quick Ratio of 1.35. This is a normal value and indicates that PRL is financially healthy and should not expect problems in meeting its short term obligations.
- PRL's Quick ratio of 1.35 is fine compared to the rest of the industry. PRL outperforms 75.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.04 | ||
| Quick Ratio | 1.35 |
3. Growth
3.1 Past
- PRL shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 31.74%, which is quite impressive.
- Measured over the past years, PRL shows a quite strong growth in Earnings Per Share. The EPS has been growing by 13.66% on average per year.
- Looking at the last year, PRL shows a quite strong growth in Revenue. The Revenue has grown by 12.32% in the last year.
- The Revenue has been growing slightly by 2.82% on average over the past years.
EPS 1Y (TTM)31.74%
EPS 3Y13.92%
EPS 5Y13.66%
EPS Q2Q%49.21%
Revenue 1Y (TTM)12.32%
Revenue growth 3Y4.41%
Revenue growth 5Y2.82%
Sales Q2Q%16.49%
3.2 Future
- PRL is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.21% yearly.
- The Revenue is expected to grow by 4.92% on average over the next years.
EPS Next Y29.26%
EPS Next 2Y19.15%
EPS Next 3Y16.58%
EPS Next 5Y10.21%
Revenue Next Year10.6%
Revenue Next 2Y7.81%
Revenue Next 3Y6.89%
Revenue Next 5Y4.92%
3.3 Evolution
- The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 24.16, which indicates a rather expensive current valuation of PRL.
- Based on the Price/Earnings ratio, PRL is valued a bit cheaper than the industry average as 61.54% of the companies are valued more expensively.
- Compared to an average S&P500 Price/Earnings ratio of 28.60, PRL is valued at the same level.
- With a Price/Forward Earnings ratio of 20.22, PRL is valued on the expensive side.
- 63.46% of the companies in the same industry are more expensive than PRL, based on the Price/Forward Earnings ratio.
- PRL is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.83, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.16 | ||
| Fwd PE | 20.22 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, PRL is valued a bit more expensive than the industry average as 67.31% of the companies are valued more cheaply.
- The rest of the industry has a similar Price/Free Cash Flow ratio as PRL.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.14 | ||
| EV/EBITDA | 16.13 |
4.3 Compensation for Growth
- PRL's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- PRL has an outstanding profitability rating, which may justify a higher PE ratio.
- A more expensive valuation may be justified as PRL's earnings are expected to grow with 16.58% in the coming years.
PEG (NY)0.83
PEG (5Y)1.77
EPS Next 2Y19.15%
EPS Next 3Y16.58%
5. Dividend
5.1 Amount
- PRL has a Yearly Dividend Yield of 1.00%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 1.99, PRL is paying slightly less dividend.
- Compared to an average S&P500 Dividend Yield of 1.82, PRL's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1% |
5.2 History
- The dividend of PRL has a limited annual growth rate of 3.54%.
Dividend Growth(5Y)3.54%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- 24.37% of the earnings are spent on dividend by PRL. This is a low number and sustainable payout ratio.
- PRL's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP24.37%
EPS Next 2Y19.15%
EPS Next 3Y16.58%
RALPH LAUREN CORP / PRL.DE FAQ
What is the fundamental rating for PRL stock?
ChartMill assigns a fundamental rating of 7 / 10 to PRL.DE.
What is the valuation status for PRL stock?
ChartMill assigns a valuation rating of 4 / 10 to RALPH LAUREN CORP (PRL.DE). This can be considered as Fairly Valued.
How profitable is RALPH LAUREN CORP (PRL.DE) stock?
RALPH LAUREN CORP (PRL.DE) has a profitability rating of 8 / 10.
What is the expected EPS growth for RALPH LAUREN CORP (PRL.DE) stock?
The Earnings per Share (EPS) of RALPH LAUREN CORP (PRL.DE) is expected to grow by 29.26% in the next year.
Is the dividend of RALPH LAUREN CORP sustainable?
The dividend rating of RALPH LAUREN CORP (PRL.DE) is 4 / 10 and the dividend payout ratio is 24.37%.