Should You Really Buy Ralph Lauren After Inventory Jumped 47%?
Investors were happy to learn that Ralph Lauren (NYSE: RL) is still targeting solid sales and earnings growth this year. Wall Street had been worried about slowing demand, supply chain challenges, and declining profitability compared to impressive results in these areas last year.
Ralph Lauren eased a few of these worries with its latest earnings update showing steady demand and a stable profit margin outlook. The stock is performing well compared to the wider market in 2022, likely because investors see the potential for a rally if consumer spending stays strong through the holiday season.
That enthusiasm should be tempered by major risks with the apparel and accessories specialist, the biggest of which is that Ralph Lauren is entering the key holiday shopping season with too much inventory.
Source Fool.com
