Top 5 Luxury Clothing Stocks to Invest in Now

In this article, we discuss the top 5 luxury clothing stocks to invest in now. To read the detailed analysis of the luxury goods industry, go directly to the Top 11 Luxury Clothing Stocks to Invest in Now.

5. Ralph Lauren Corporation (NYSE:RL)

Number of Hedge Fund Holders: 38

Ralph Lauren Corporation (NYSE:RL) designs and distributes luxury lifestyle products and it sells its most luxurious clothing items through its Ralph Lauren Collection and Ralph Lauren Purple Label divisions. On our list of the top luxury clothing stocks to invest in now, Ralph Lauren Corporation (NYSE:RL) ranks fifth.

As of April 24, 8 Wall Street analysts keep a Buy rating on Ralph Lauren Corporation (NYSE:RL) and the average price target of $192.33 implies an upside of 14.71% from the current levels.

In the fourth quarter of 2023, 38 hedge funds held stakes in Ralph Lauren Corporation (NYSE:RL), and the total stake value was $719.705 million. This is compared to 26 funds in the previous quarter, with positions worth $321.640 million. As of the fourth quarter of 2023, Marshall Wace LLP initiated a position in the stock and is the biggest shareholder with a position worth $137.615 million.

4. Tapestry, Inc. (NYSE:TPR)

Number of Hedge Fund Holders: 40

Tapestry, Inc. (NYSE:TPR) designs and manufactures high-end accessories and branded lifestyle products through different brands, including Coach, Kate Spade, and Stuart Weitzman. 40 hedge funds had investments in Tapestry, Inc. (NYSE:TPR) and the total stake value was $800.857 million. As of Q4 of 2023, Citadel Investment Group is the top investor and has increased its stake in the company by 4552% to nearly 4 million shares worth $147.150 million.

As of April 24, Tapestry, Inc.’s (NYSE:TPR) stock has gained 25.45% and the company has seen EPS growth of 23.01% in the last 5 years.

11 Wall Street analysts keep a Buy rating on Tapestry, Inc. (NYSE:TPR) and the average price target of $51.29 has an upside of 29.16% from the last price of $39.71, as of April 24.

3. Lululemon Athletica Inc. (NASDAQ:LULU)

Number of Hedge Fund Holders: 52

Lululemon Athletica Inc. (NASDAQ:LULU) is engaged in the design and distribution of luxury athletic apparel, footwear, and accessories. The stock is among the top luxury clothing stocks to invest in now. Lululemon Athletica Inc. (NASDAQ:LULU) has a consensus Buy rating among 17 analysts, and its average price target of $487.81 implies an upside of 33.46% from current levels, as of April 24.

In the fourth quarter of 2023, 52 hedge funds held positions in Lululemon Athletica Inc. (NASDAQ:LULU), and their stakes amounted to $1.339 billion. D E Shaw is the most dominant shareholder in the company and has a position worth $306.97 million, as of December 31, 2023.

Ithaka Group stated the following regarding Lululemon Athletica Inc. (NASDAQ:LULU) in its first quarter 2024 investor letter:

“Lululemon Athletica Inc. (NASDAQ:LULU) is principally a designer, distributor, and retailer of healthy lifestyle inspired athletic apparel. It‘s moat is almost entirely based on its intangible brand asset. Of late, the company has benefited from both the longstanding athleisure fashion trend and the more recent pandemic-induced, work-from-home trend toward more casual attire. Approximately 45% of sales are generated across ~700 company-owned stores, 45% of sales (and growing rapidly) are generated online (lululemon.com), and ~10% of sales are generated by wholesale partners, which primarily comprise fitness studios. The stock’s underperformance was concentrated around the F4Q earnings announcement, which saw the company meet expectations for the current quarter but provide cautious commentary regarding tepid US consumer spending behavior.”

2. Capri Holdings Limited (NYSE:CPRI)

Number of Hedge Fund Holders: 58

Capri Holdings Limited (NYSE:CPRI) is a designer and seller of branded apparel, footwear, and accessories. The company sells its products under various luxury brands, including Versace, Jimmy Choo, and Michael Kors.

Capri Holdings Limited (NYSE:CPRI) was part of 58 hedge funds’ portfolios in the fourth quarter of 2023 with a total stake value of $1.276 billion. As of December 31, 2023, Pentwater Capital Management is the most prominent shareholder in the company and has increased its stake by 293% to 4 million shares worth $200.960 million.

Fred Alger Management made the following comment about Capri Holdings Limited (NYSE:CPRI) in its Q3 2023 investor letter:

“Capri Holdings Limited (NYSE:CPRI) is a global fashion retailer with over 1,300 stores around the world. The company operates a portfolio of luxury handbags and other accessories, including Michael Kors, Versace and Jimmy Choo. During the period, shares contributed to performance after the company received a cash offer from its closest competitor, Tapestry, Inc., the owner of Coach, Kate Spade and Stuart Weitzman, for $57 per share or a 63% premium to where the stock was trading on the day it was announced. The deal has been approved by the company’s board. We believe there is minimal regulatory risk related to the deal and expect the deal to close by the end of the calendar year.”

1. NIKE, Inc. (NYSE:NKE)

Number of Hedge Fund Holders: 69

NIKE, Inc. (NYSE:NKE) designs and manufactures higher-end products that are often accompanied by elevated services. For example, the company’s HyperAdapt 1.0 self-lacing sneaker of $720 comes with an assistance number of HyperAdapt owners. Likewise, Nike’s Jordan Brand Wings Collection contains items that are handmade in Italy using high-quality materials.

NIKE, Inc. (NYSE:NKE) tops our list of luxury clothing stocks to invest in now. On April 11, BofA upgraded the stock to Buy from Neutral and increased the price target to $113 from $110.

In the fourth quarter of 2023, 69 hedge funds held positions in NIKE, Inc. (NYSE:NKE) worth $3.53 billion. As of Q4 of 2023, Fisher Asset Management is the most significant shareholder in the company and has a position worth $1.07 billion.

Polen Capital stated the following regarding NIKE, Inc. (NYSE:NKE) in its first quarter 2024 investor letter:

“The largest absolute detractors were Adobe, Zoetis, and NIKE, Inc. (NYSE:NKE). Nike has experienced a prolonged period of cost headwinds, offsetting its increasing revenue from direct-to-consumer channels, which would typically enhance its margins. In addition, a gap in new product innovations in recent years has caused earnings growth to stall temporarily. We see these transient headwinds abating, and the company plans to launch several innovations in footwear commensurate with the Paris 2024 Olympics. We believe this should lead to increased revenue growth as cost headwinds abate, thus accelerating earnings growth.

We increased our positions in ThermoFisher Scientific, Visa, Zoetis, Nike, and Abbott Labs. Each of these companies is durable and available at attractive valuations, in our view, for the growth we see ahead. In fact, in the case of ThermoFisher, Nike, and Abbott Labs, we expect accelerating earnings growth in the back half of 2024 after more difficult earnings growth periods pass for each of these companies. Nike will likely be free of transient cost headwinds that have recently held back margin expansion opportunities.”

Should you invest $1,000 in NIKE, Inc. (NYSE:NKE) right now?

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Disclosure: None. You can also look at the 30 Wealthiest People in Canada and 12 Under-the-Radar Stocks With Massive Upside for 2024.

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