Lululemon (LULU): Assessing Valuation After Recent Share Price Declines

Lululemon athletica (LULU) stock has been on the move lately, with shares slipping nearly 4% over the past week and showing a downward trend this month. Longer-term investors are seeing double-digit declines from recent highs.

See our latest analysis for lululemon athletica.

Lululemon athletica’s share price has lost momentum this year, with a sharp 55.91% drop since January and a 46.96% 1-year total shareholder return decline. This has left many investors questioning whether renewed growth is still on the horizon. Short-term swings have added to the volatility, reflecting shifting perceptions around the company's near-term risks and potential for recovery.

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With shares down sharply despite a still-profitable business and analysts seeing further upside, the key question now is whether Lululemon is trading below its true value or if future growth is already fully reflected in the price.

Most Popular Narrative: 15.5% Undervalued

Lululemon’s most closely watched narrative puts its fair value well above the latest close, hinting at meaningful upside if growth plans materialize. The market’s recent sell-off has set the stage for renewed debate about what’s next.

The company is implementing a significant reset in its product approach, increasing the share of new styles in its assortment from 23% to 35% by Spring 2026. It is also investing in faster, more agile design and supply chain processes. These actions are expected to revitalize core categories, drive higher conversion, and support a reacceleration in U.S. and global revenue growth.

Read the complete narrative.

Want an inside look at the ambitious growth strategy behind this price target? There is a surprising mix of aggressive category bets, international market plays, and bold profit forecasts powering that number. Which bold assumption could be the swing factor? Dive deeper and see what’s driving this call on Lululemon’s future.

Result: Fair Value of $194.36 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, weakening U.S. sales and new tariff pressures could quickly curb optimism. These factors may challenge the bullish scenario if cost-saving measures fall short.

Find out about the key risks to this lululemon athletica narrative.

Build Your Own lululemon athletica Narrative

If you have a different perspective or want to dig into the numbers yourself, you can easily craft your own viewpoint on Lululemon’s outlook in just a few minutes. Do it your way

A great starting point for your lululemon athletica research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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