RL
Ralph Lauren Corporation
$377.40
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 138.8% above fair value
You pay
$377.40
Bear
$128.91
Fair
$158.04
Bull
$184.04
Bear
$128.91
-65.8%
4% stage 1 growth, 12% discount
Fair
$158.04
-58.1%
6% stage 1 growth, 12% discount
Bull
$184.04
-51.2%
8% stage 1 growth, 12% discount
Adjust Assumptions
6.5%
12.0%
3.0%
Key Value Driver
FCF growth rate (6% base case)
Terminal Value % of EV
32%
Implied Market Multiple
33.2x
Market is pricing in (growth)
17.7%
vs 6.5% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (48 analysts)
$456.67
Divergence from AlphaVal
65%
Summary
Using a two-stage FCF DCF with 6% growth decelerating over 15 years, discounted at 12%, the base-case intrinsic value is $158.04 per share.
Warnings
Wall Street's average price target is $456.67 (from 48 analysts). Our estimate is 65% below the consensus -- consider that gap carefully.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions