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Lululemon Athletica Inc. (LULU), based in Vancouver, Canada, is a lifestyle-inspired athletic apparel company specializing in yoga, running, training, and other active pursuits. With a market cap of $49.1 billion, Lululemon is renowned for the comfort of its clothing and its ability to create transformative products and experiences.
The activewear powerhouse is expected to release its fourth-quarter results on Thursday, Mar. 20. Ahead of the event, analysts expect Lululemon to report a profit of $5.86 per share, marking a 10.8% increase from $5.29 per share reported in the year-ago quarter. Impressively, Lululemon has beaten analysts' expectations in the last four quarters. Its EPS of $2.87 for the last reported quarter surpassed the consensus estimates by 6.7%.
For the full fiscal 2025, LULU is expected to report a profit of $14.36, up 12.5% from $12.77 in fiscal 2024. While in fiscal 2026, its earnings are expected to grow 6.8% year-over-year to $15.34 per share.
LULU stock has dropped 14.4% over the past 52-week period, significantly underperforming the S&P 500 Index’s ($SPX) 24.1% surge and the Consumer Discretionary Select Sector SPDR Fund’s (XLY) 34.9% returns during the same time frame.
Despite its underperformance over the past year, Lululemon’s stock has performed well recently. Its stock prices soared 15.9% in the trading session after the release of its Q3 results on Dec. 5. Although the company’s Americas sales increased by a modest 2%, its international net revenues surged by a staggering 33%. This led to a robust 8.7% year-over-year growth in overall net revenues to $2.4 billion, surpassing the consensus estimates by a notable 1.8%. Meanwhile, the company showcased impressive expense discipline. After adjusting for impairment expenses incurred in the year-ago quarter, Lululemon’s income from operations increased 18.9% year-over-year to $490.7 million.
Furthermore, on Jan. 13, Lululemon raised its Q4 net revenues guidance to $3.56 billion - $3.58 billion, up from the previously announced range of $3.48 billion to $3.51 billion. And raised its EPS guidance to $5.81 - $5.85, up from $5.56 to $5.64.
The consensus opinion on LULU stock is moderately bullish, with an overall “Moderate Buy” rating. Out of the 30 analysts covering the stock, 14 recommend “Strong Buy,” 3 suggest “Moderate Buy,” 10 advise “Hold,” one advocate “Moderate Sell,” and two give a “Strong Sell” rating. As of writing, the stock is trading slightly above its mean price target of $402.80.
