Shares of Lululemon Athletica Inc LULU tanked practically 15% at last look at Friday in spite of the clothing business’s positive fourth-quarter report.
Here are some essential expert takeaways.
- BMO Capital Markets expert Simeon Siegel restated a Market Perform score, while decreasing the cost target from $313 to $302.
- KeyBanc Capital expert Ashley Owens preserved an Obese score, while cutting the cost target from $420 to $400.
- Goldman Sachs expert Brooke Roach declared a Neutral score, while slashing the cost target from $397 to $363.
- Needham expert Tom Nikic restated a Buy score, while reducing the cost target from $430 to $366.
- Telsey expert Dana Telsey preserved an Outperform score, while cutting the cost target from $445 to $385.
- Bank of America expert Lorraine Hutchinson restated a Buy score, while decreasing the cost target from $480 to $400.
Take a look at other expert stock rankings.
BMO Capital Markets: Lululemon’s gross margins broadened by 100 basis points (bps) year-on-year and can be found in 70bps above market expectations, “driven by much better item margin and lower markdowns,” Siegel stated.
Management directed to first-quarter incomes in-line with expectations, while directing to frustrating incomes. “We continue to see LULU as a strong, however overstretched, brand name and are fretted about long-lasting domestic and females’s earnings sizing as the brand name continues to deal with extending even more,” the expert included.
KeyBanc Capital Markets: Lululemon reported incomes of $3.61 billion. That’s up 13% year-on-year and whipping agreement of $3.57 billion. The business’s gross margins broadened to 60.4%, driving incomes to $6.14 per share versus agreement of $5.84 per share, Owens stated.
The expert anticipated that management would direct to full-year incomes of $11.15 B–$ 11.3 B. The business prepares to continue buying developing brand name awareness and open 40-45 brand-new shops in 2025.
Goldman Sachs: Lululemon’s margins outshined projections by a large margin, “mainly driven by more powerful leading line shipment, disciplined expenditure management, and take advantage of FX,” Roach stated. The business’s incomes can be found in greater than its pre-announced variety.
” Looking ahead, the business struck a useful tone on its FY25 development pipeline, with newness prepared throughout fabrications and franchises,” the expert composed. Management directed to first-quarter incomes of $2.53-$ 2.58 per share, lower than agreement of $2.72 per share.
Needham: Lululemon Athletica had actually raised its fourth-quarter assistance in January and still provided a beat, however this was eclipsed by frustrating full-year assistance, Nikic stated. The business’s newest outlook looks conservative, he included.
Although clients are reacting well to the newness in Lululemon Athletica line of product, this might not suffice to balance out a “macro-related downturn,” the expert specified. While the business has a number of upcoming developments, it has actually “not been unsusceptible to the industry-wide downturn in traffic due to increased macroeconomic unpredictability.”
Telsey Advisory Group: Lululemon Athletica’s quarterly beat was driven by “strength throughout the board, as sales, gross margin, and expenditure deleverage were all much better than anticipated,” Telsey stated. The business’s sales grew 12.7% to $3.612 billion and gross margins broadened to 60.4%, “perfectly surpassing the marketplace expectation,” she included.
” Encouragingly, the newness was back to historic levels in 1Q25, following the pullback in FY24 that weighed on outcomes,” the expert composed. Nevertheless, the business is affected by a downturn in traffic due to macro issues in the United States, she even more specified.
BofA Securities: Consumers reacting well to newness boosts self-confidence in Lululemon Athletica having the ability to speed up sales development in The United States and Canada when traffic supports, Hutchinson stated. She included that the business has not ingrained enhancing United States patterns in its full-year assistance, unlike its peers.
” If this customer soft spot shows to be temporary, we anticipate much better item and activations to drive sales upside,” she composed.
Rate Action: Shares of Lululemon had actually decreased by 14.97% to $291.02 at the time of publication on Friday.
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Momentum 75.92
Development 72.08
Quality 52.55
Worth 47.37
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