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Bullish case for Lululemon Athletica (LULU)

MS
mschoen25Not Invested
Community Contributor
Published
17 Sep 24
Updated
27 Mar 25
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mschoen25's Fair Value
US$319.86
18.4% undervalued intrinsic discount
27 Mar
US$261.03
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1Y
-22.3%
7D
-1.0%

Author's Valuation

US$319.9

18.4% undervalued intrinsic discount

mschoen25's Fair Value

Lululemon (LULU) appears to be undervalued based on current analysis. The stock is trading around $281.35, with analysts predicting a consensus price target of $354.94, indicating about a 26% upside potential. While Lululemon's growth has slowed, it maintains a "Moderate Buy" rating from a majority of analysts, with 21 out of 32 recommending a buy​(

MarketBeat

). Additionally, recent insider buying by the CEO suggests confidence in the company's future performance​

  1. Positive Analyst Ratings: Recent analyst upgrades and positive ratings reflect growing confidence in Lululemon’s future prospects. Analysts have highlighted the company’s strong growth trajectory, innovative product offerings, and effective management as key reasons for their bullish outlook.
  2. Resilient Market Position: Despite macroeconomic uncertainties and market volatility, Lululemon has shown resilience. Its strong market position in the premium athleisure segment and its ability to adapt to changing consumer preferences have helped it navigate challenges effectively.

Overall, Lululemon’s strong financial performance, innovative product offerings, expansion efforts, and commitment to sustainability provide a compelling bullish case for the stock. Investors looking for a growth-oriented investment in the consumer discretionary sector might find LULU to be a promising candidate.

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Disclaimer

The user mschoen25 holds no position in NasdaqGS:LULU. Simply Wall St has no position in any of the companies mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The author of this narrative is not affiliated with, nor authorised by Simply Wall St as a sub-authorised representative. This narrative is general in nature and explores scenarios and estimates created by the author. The narrative does not reflect the opinions of Simply Wall St, and the views expressed are the opinion of the author alone, acting on their own behalf. These scenarios are not indicative of the company's future performance and are exploratory in the ideas they cover. The fair value estimates are estimations only, and does not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that the author's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

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3 days ago author updated this narrative