Polo Ralph Lauren: Looking Good

When it comes to a true-blue American lifestyle brand, you don't have to look much farther than Polo Ralph Lauren (RL - commentary - Cramer's Take). From its squeaky-clean advertising campaigns to brands that are as American as apple pie, Polo Ralph Lauren boasts a powerful wholesale, retail and licensing package. Plus, its shares are likely to keep strutting higher over the next several quarters because of rock-solid fundamentals and an attractive technical outlook.

I have to admit, for a long time I didn't give the company much of a second look. I thought the brand and image were stale and dated. And while the financials were OK, they weren't blowing me away by any stretch of the imagination. Plus, I didn't like the super-thin margins.

But I couldn't ignore the fact that the stock is slamming through new highs day after day. And that annoying new 52-week-high indicator on my charting program kept telling me Polo Ralph Lauren might be worth checking out. So I dug a little deeper into the company and found some factors worth getting excited about.

It's a Lifestyle

"Lifestyle" branding is so common these days that we barely give it a second thought. In fact, most of us don't even know we're responding to lifestyle brands. But they're everywhere, from Pacific Sunwear's (PSUN - commentary - Cramer's Take) surfer image to Hot Topic's (HOTT - commentary - Cramer's Take) music-based push to Martha Stewart's (MSO - commentary - Cramer's Take) classic Northeastern shtick. The concept -- which includes marketing a single style or image across a broad range of retail products -- has become the most powerful retail strategy out there.

But in the old days, that's wasn't the case. Marketers and retailers pushed products on the basis of product features, durability and what need they fulfilled. In other words, they sold stuff on the basis of how it functioned. There wasn't any more of a "lifestyle" in a pair of jeans than there was in a washing machine.

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At the time of publication, Burritt had no positions in any of the stocks mentioned in this column, although positions may change at any time. Wayne Burritt is president and director of equity research for Burritt Research, which operates BurrittResearch.com. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Burritt appreciates your feedback; click here to send him an email.