Should You Think About Buying Ralph Lauren Corporation (NYSE:RL) Now?

While Ralph Lauren Corporation (NYSE:RL) might not be the most widely known stock at the moment, it saw significant share price movement during recent months on the NYSE, rising to highs of US$120 and falling to the lows of US$106. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Ralph Lauren's current trading price of US$106 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Ralph Lauren’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for Ralph Lauren

What's The Opportunity In Ralph Lauren?

Good news, investors! Ralph Lauren is still a bargain right now. According to my valuation, the intrinsic value for the stock is $138.35, but it is currently trading at US$106 on the share market, meaning that there is still an opportunity to buy now. However, given that Ralph Lauren’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.

What does the future of Ralph Lauren look like?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. Ralph Lauren's earnings over the next few years are expected to increase by 43%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What This Means For You

Are you a shareholder? Since RL is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With a positive outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on RL for a while, now might be the time to make a leap. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy RL. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed buy.

If you want to dive deeper into Ralph Lauren, you'd also look into what risks it is currently facing. Case in point: We've spotted 1 warning sign for Ralph Lauren you should be aware of.

If you are no longer interested in Ralph Lauren, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.