Lululemon Athletica Does It Again!



Series snapshot

Lululemon Athletica (LULU) proved that it had delivered another solid performance when it reported its fiscal second-quarter results on August 30. Its share price soared as much as 16.6% on the following trading day before finally closing at $154.93, 13.1% up from the previous day’s close. The company recorded stellar same-store sales growth along with solid margin improvement.

LULU’s total sales increased 24.5% YoY (year-over-year) to $723.5 million, $56 (or 8%) more than Thomson Reuters I/B/E/S estimates. Its adjusted EPS stood at $0.71, up 82% YoY and $0.22 (or 45%) more than analysts’ expectations. Its results relate to the three-month period that ended on July 29.

This was the sixth consecutive top and bottom line beat for the company. Read more about Lululemon’s fiscal second-quarter performance in the next two parts of this series.

The company’s strong results led not only to its stock price surge but also to a host of analysts revising their price targets on its stock. Read Part Four of this series to learn about the company’s year-to-date stock market performance and analysts’ actions following its results.

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About Lululemon Athletica

Lululemon Athletica designs and sells lifestyle athletic apparel inspired by yoga and other fitness activities. It operates more than 400 stores across the United States, Canada, New Zealand, Asia, Australia, and the United Kingdom.

With a market cap of $18.8 billion as of August 31 and trailing-12-month sales of $2.8 billion, Lululemon is still a relatively small player in the sportswear space. In comparison, industry leader Nike (NKE) has trailing-12-month sales of $36.4 billion and a market cap of $132.3 billion.

ETF investors seeking to add exposure to LULU can consider the iShares Edge MSCI Multifactor Consumer Discretionary ETF (CNDF), which invests 2.9% of its portfolio in LULU.


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