Data suggests Ralph Lauren sales could be up in Q1

1 week ago by Jon Marino in News, Trends

Ralph Lauren ($NYSE:RL) will report earnings Tuesday morning and the stock has rebounded after taking a dive around the holiday shopping season to end 2018. According to Zacks Investment Research posted at Nasdaq, average analyst expectations are for $0.93 earnings-per-share for the fashion brand. 

Data shows the company has added more staff and began offering discounts to start the year. It could be a sign that CEO Patrice Louvet's plan to take inventory away from underperforming department stores is manifesting in some positive movement on some alternative data charts. 

Staffing Up to Start the Year

Our review of LinkedIn ($NYSE:LNKD) data shows there has been a substantial uptick in people currently listing Ralph Lauren as their place of employment. Now, some of this may be part-time work (there are dozens of positions advertised for part-time work at the company's website today). But a company beefing up staffing capabilities outside of the holiday season may be taken as a positive sign by investors. 

Web Discounts Went Up to Start the Year - Then, Fell

Our data tracks whether - and to what extent - online retailers are cutting inventory for direct sales via the web. Just like it did in late 2018, Ralph Lauren began the year offering steep discounts - and then, cut back on promotional offerings. Last year the company cut discounts from 48% as of September 12, 2018, to a low of 27.5% by November 26. This year, discounts rose to a high of 36% in early February, only to fall back to last year's Black Friday lows. The significance of this is, when Ralph Lauren sold inventory into lower discounts last year, it preceded an earnings beat that sent the stock up 30% in a little over a month to begin 2019. Investors should be hopeful reduced discounts to kick off the new year correlate to higher demand, too. 

Social Slowdown?

Ralph Lauren's Facebook ($NASDAQ:FB) Likes appear to be leveling off, gaining less than a quarter-percent so far this year. The second chart tracks Twitter ($NYSE:TWTR) followers - and it appears Ralph Lauren has lost a few followers since 2018. 

Here's the tricky thing about social - at this point, pretty much all of us who were going to get onto social media, finally have. Other mega-retailers are seeing a similar drop-off in social engagement - but it could just be a signal that attention from this particular medium is hitting a peak. Or, in other words, if a ton of retailers beat expectations despite social engagement going sideways - this may signal a peak for social advertising, rather than a so-called 'retail apocalpyse.' 

A prior version of this article included a chart with incorrect data - we have replaced the chart and a portion of text. 

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Jon Marino

Jon Marino is Thinknum's finance editor, covering the impacts of alternative data on public companies and investors. Prior to joining Thinknum, Jon worked in the ...

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