Lululemon’s stock price performance
Lululemon Athletica (LULU) stock surged 6.1% in the after-hours trading session after it reported a stellar fiscal 4Q17 and issued optimistic fiscal 2018 guidance on March 27, 2018.
The company is currently sitting at a modest YTD (year-to-date) rise of 0.2%. In comparison, competitors Nike (NKE), Under Armour (UAA), and Columbia Sportswear (COLM) have risen 5.8%, 6.7%, and 0.7%, respectively.
Wall Street’s view on LULU
A total of 31 Wall Street analysts cover Lululemon, and together they’ve rated the company a 2.3 on a scale of 1 (strong buy) to 5 (sell). Sportswear players Nike and Columbia Sportswear have both been rated 2.2. Under Armour, on the other hand, has been rated 3.2, while Skechers has received a rating of 1.5.
Of the 31 analysts covering LULU, 58% have recommended “buys” on the stock, while 39% have suggested “holds.” Only 3% of analysts have set “sells” on the stock.
Several analysts increased the company’s price target after its fiscal 4Q17 results release. Barclays raised its target from $95 to $100, Cowen and Company raised its target from $90 to $96, JPMorgan Chase raised its target from $92 to $95, and Credit Suisse raised its target from $96 to $98.
Lululemon stock is currently trading at a one-year forward price-to-earnings ratio of 26x compared to its three-year average of 28x. The company is expensive compared to Columbia Sportswear’s 24x, but its valuation is similar to Nike’s 26x.
ETF investors seeking to add exposure to LULU can consider the iShares Edge MSCI Multifactor Consumer Discretionary ETF (CNDF), which invests 0.4% of its portfolio in LULU.