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Ralph Lauren, Toll Brothers: Stocks to watch

Yahoo Finance Live breaks down the stock performance of several companies trending after Thursday's closing bell.

Video transcript

SEANA SMITH: All right, let's take a look at some couple of movers here. And first up, shares of Ralph Lauren, a jump of just about 5% here, closing the day in the green after the luxury apparel and accessories company reported a big fiscal fourth-quarter profit beat and revenue that topped forecasts. It also posted a more than 30% jump in sales in China, with demand in the key luxury market rebounding sharply.

They did see some weakness on a year-over-year basis when it comes to revenue in North America and in Europe. But again, it looks like the street's focusing on that beat, focusing on some of the strength, Akiko, that they are seeing over in Asia. We're looking at gains of just about 5%.

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AKIKO FUJITA: Yeah, regional breakdown's certainly really an interesting one for me. When you think about the luxury sector, Asia, largely China, was sort of the big driver pre-pandemic. That market has been shut down significantly since 2020. So the comps, when you think about it-- I mean, last year, we were still in a zero-COVID policy over in China. You can expect to see a big rebound there, but the 12.7% increase there in terms of net revenue in China, or at least Asia overall, certainly adding to the lift in the stock today.

We are also checking in on shares of Toll Brothers, closing the day higher after RBC Capital Markets upgraded the homebuilder to outperform from sector perform. The firm noting sentiment around the stock is overly negative, and it is expecting outsize order growth. We've heard a lot about homebuilding this week, Seana, just about, number one, material costs, how that's been weighing on things, but also just the demand in the market, just given inventory.

SEANA SMITH: Yeah, certainly. And we're seeing homebuilders having that edge there because of the fact that they're able to capture more of those potential buyers out there, given the fact that the inventory for existing homes is so bleak right now. When you take a look at this call from RBC, the analysts there citing the improved demand stronger orders and also the resilient margins that we are looking at with Toll Brothers.

And this is a stock that has performed well since the start of the year. Year to date, we're looking at gains of just about 30%. On a one-year basis, you're looking at gains of about 41%. So housing market has a ways to go. We know inventory mismatch here, the bleak inventory picture, obviously, a huge challenge for housing. But Toll Brothers and many of the other homebuilders positioned well in order to capture some of that demand that's out there.