LULU's revenue jumped nearly 41% between fiscal year 2011 and FY 2010, from $712 million to a cool $1 billion. Ralph, on the other hand, makes more than LULU makes in a year in just one quarter. In the third quarter of FY 2012, Ralph reported revenue of $1.81 billion vs. $1.55 billion in the same period of FY 2011. You do not necessarily expect to see 16.7% revenue growth, year-over-year, from an old heritage company like Ralph Lauren, but there it is.
I'm a fan of buying the leaders in a space alongside their indirect offspring. LULU amounts to the illegitimate love child Ralph Lauren never knew he fathered. By the same token, LULU follows in her father's footsteps none the wiser.
The market crushed both stocks on Tuesday. RL was down 3.1%, closing at $163.38. The stock dove as low as $154.25 intraday. LULU shed 3.0% to $74.93, but bottomed at $70.50 intraday. Heck, if you got in at or near Tuesday's intraday lows, you've more than outperformed the guy sitting next to you.
>>To see these stocks in action, visit the 5 Stocks to Buy While Others Are Afraid portfolio on Stockpickr.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV