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Lululemon's CEO saying the company continues to navigate some challenging dynamics is corporate speak for serious trouble. The stock fell 18% after hours on the results. x.com x.comÂ
Lululemon is a stock to avoid around earnings, good or bad, as apparel names almost always are. Too many investors were fooled by its compounder story coming out of Covid. x.comÂ
Lululemon is an 800lb gorilla worth defending despite bad management and the politics around its skin-tight leggings. x.comÂ
Lululemon is losing customers because it stopped innovating and its brand stance alienated buyers, hurting its own stock as happened with Nike. Shoppers are shifting to Alo, Vuori, Hoka, On and others, and its quality no longer looks as strong. Lululemon shares have fallen to their lowest level in nearly 10 years, per Kalshi. x.comÂ
Lululemon is losing its customer to Alo Yoga, the shiny new brand, while its shareholder base shifts toward value investors. @BillBrewsterTBB notes most women he talks to have gone from fans to lukewarm, while those who like the stock are value-investing men, a mismatch that shows the perils of a shifting shareholder base. x.comÂ
Lululemon trading at about 7x earnings is absurdly cheap, among the most mispriced stocks around. x.comÂ
Lululemon has lost its way. Its brand and products are good, but its market is saturated. x.comÂ
Lululemon's problem is its pricing, not a weak consumer. Shoppers are fine but aren't buying its products because the prices no longer make sense, which spells trouble for its margins. x.comÂ
Lululemon is cheap at around 11x earnings with gross margins above 50%, while many people, including the founder, are pushing for a turnaround. Sales growth is tiny, but the balance sheet is solid and the company makes an interesting acquisition target. The reported collapse of talks with founder Chip Wilson, per WSJ via @DeItaone, looks good for the stock: Wilson may try to take it private or bring in a strategic buyer. x.com x.comÂ
Lululemon is no bargain at $99 and an 8x P/E, with revenue shrinking 4% and guidance slashed in two consecutive quarters. x.comÂ