Ralph Lauren Corporation
) - a designer, marketer and distributor of lifestyle products -
is likely to beat expectations while reporting its fourth-quarter
fiscal 2013 results on May 23.
Why a Likely Positive Surprise?
Our proven model shows that Ralph Lauren may beat the earnings
because it has the right combination of two key components -
Positive Earnings ESP (Read:
Zacks Earnings ESP: A Better Method
) and a Zacks Rank #3.
Ralph Lauren currently has an Earnings ESP of +3.08%. This is
because the Most Accurate Estimate stands at $1.34, while the
Zacks Consensus Estimate is pegged at $1.30.
Stocks with Zacks Rank #1, #2 and #3 have significantly higher
chances of beating the earnings. The sell rated stocks (#4 and
#5) should never be considered going into an earnings
The combination of Ralph Lauren's Zacks Rank #3 (Hold) and
Earnings ESP of +3.08% makes us confident regarding a positive
earnings beat by the company on May 23.
What is Driving the Better-than-Expected
We believe that Ralph Lauren's initiatives to capitalize on
opportunities in emerging markets along with its focus on core
business activities augur well for the future operating
performance. Going forward, Ralph Lauren's growth story looks
compelling as we believe that the company's sustained focus on
expanding higher growth businesses, such as accessories category,
along with strategically expanding its global operations will
boost its top and bottom lines. Moreover, Ralph Lauren leverages
its globally renowned brands and premium positioning to bolster
its well-established business in the specialty retailing sector.
Looking at the earnings surprise history, the company has beaten
the Zacks Consensus Estimates in the past several quarters. Ralph
Lauren has surpassed the Zacks Consensus Estimate in the trailing
4 quarters with an average surprise of 11.4%, and most recently
topping by 8.6% in the third quarter of fiscal 2013.
Other Stocks to Consider
Ralph Lauren is not the only firm we are looking up to this
earnings season. The following companies are also likely to beat
the earnings in the to-be-reported quarter:
) with an Earnings ESP of +25.00% and a Zacks Rank #2 (Buy).
) with an Earnings ESP of +0.73% and a Zacks Rank #3 (Hold).
Fifth & Pacific Companies Inc.
) has an Earnings ESP of +10.00% and carries a Zacks Rank #3
FIFTH PACIFIC (FNP): Free Stock Analysis
PVH CORP (PVH): Free Stock Analysis Report
RALPH LAUREN CP (RL): Free Stock Analysis
QUIKSILVER INC (ZQK): Free Stock Analysis
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