Earnings Preview: Polo Ralph Lauren

Polo Ralph Lauren Corp. (RL) is expected to report Q4 earnings before the market open on Wednesday, May 27, with a conference call scheduled for 9:00 am ET.

Guidance

Analysts are looking for a profit of 40c on revenue of $1.08B. The consensus range is 28c-50c for EPS, and revenue of $1B-$1.17B, according to First Call. In February the company forecast FY09 EPS $3.84-$4.00 versus its prior view of $4.00-$4.10, and First Call consensus of $3.97. The retailer also guided FY09 revenue flat to down versus its prior outlook of a low single digit increase.

Analyst Views

In a May 4 note Bank of America/Merrill downgraded the stock to Underperform from Neutral. The firm, which said underlying momentum may still be weak in apparel, noted that after benefiting from upward mobility in consumer spending patterns, continued customer traffic declines and tightened inventory plans are likely to be unfavorable to the company's core U.S. wholesale outlook through FY10. Additionally, the firm expects the difficult anniversary of the sell-in of American Living, and said declining trends could pressure Europe wholesale.