Update shared on 23 Nov 2025
Fair value Decreased 0.42%Analysts have slightly reduced their fair value target for lululemon athletica to $193.54 from $194.36, citing heightened management uncertainty, slowing North American growth, and broader sector headwinds.
Analyst Commentary
Recent street research reveals a significant shift in sentiment around Lululemon athletica, as analysts weigh ongoing management changes, North American demand challenges, and evolving sector trends.
Bullish Takeaways- Some bullish analysts continue to point to Lululemon's strong brand equity and resilient growth in international markets as ongoing strengths, even as U.S. trends soften.
- The company’s historically high gross margins and sales per square foot support the view that Lululemon has room to recover if it can reinvigorate domestic demand and limit downside in the U.S.
- Opportunities from new partnerships, improved tariff mitigation, and potential product innovation are seen as possible catalysts for future revenue growth and a return to higher earnings multiples.
- For valuation, certain analysts believe recent share price weakness and the stock’s all-time low valuation multiple present a compelling entry point, provided that execution improves.
- A growing number of bearish analysts highlight mounting execution risk due to high-profile executive departures, particularly in North America, which add uncertainty to the turnaround timeframe.
- Most note that U.S. consumer demand has slowed noticeably, with recent quarters showing declining trends and limited immediate catalysts to reverse the trajectory.
- Concerns include strategic missteps such as expanding into non-core partnerships, which are seen as diluting brand value and raising doubts about long-term positioning in the premium segment.
- Downward revisions to both price targets and earnings estimates are being driven by persistent softness in the Americas, the impact of increased tariffs, and hesitation to recommend the stock until more tangible signs of re-acceleration appear.
What's in the News
- Lululemon announces a deal with Fanatics and the National Football League to launch its first NFL fan apparel collection, causing shares to rise in pre-market trading (Bloomberg).
- Citi lowers Lululemon's price target to $220 from $270. The bank cites a forecasted small earnings beat but a guidance cut related to higher tariffs and maintains a Neutral rating on the stock (Citi).
- Lululemon unveils its new athlete kit for Team Canada for the Milano Cortina 2026 Winter Games, featuring inclusive designs and technical innovations in partnership with the Canadian Olympic and Paralympic Committees.
- Lululemon revises its 2025 full-year revenue guidance to between $10.85 billion and $11.0 billion, with diluted earnings per share projected at $12.77 to $12.97. The company anticipates a $240 million reduction in gross profit due to higher tariffs and mitigation efforts.
Valuation Changes
- Fair Value Target has decreased slightly to $193.54 from $194.36, reflecting updated analyst projections.
- Discount Rate has risen marginally and is now at 8.28% compared to 8.25% previously.
- Revenue Growth Estimate has edged down to 5.04% from 5.06%.
- Net Profit Margin is virtually unchanged, adjusting minimally to 14.17% from 14.17% prior.
- Future P/E Multiple estimate is lower at 14.95x, down slightly from 14.99x.
Disclaimer
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