Lululemon is not worth bottom-fishing even though the bad news will eventually be priced in, because forward estimates keep falling and a bottom is hard to time before fundamentals bottom. The business is not a zero: its stores are still busy, if less than before. There are better places to look for a bargain. x.com  x.com  x.com 

Lululemon is a classic value trap: EPS guidance fell by a third, so a lower share price is no cheaper, and with EPS likely flat or down for 2-3 years it may need to test the low $80s. Dozens of influencer-led apparel brands selling through Shopify, plus Alo, Vuori and GymShark, offer better products at lower prices without its costly store base. Its mediocre products at premium prices cannot win that fight, and a quick turnaround is unlikely. x.com  x.com  x.com  x.com  x.com 

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.com 

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.com 

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.com 

Lululemon offers better risk/reward than Nike if it is not broken, trading below 5x EV/EBITDA versus Nike's 14x. Nike's turnaround through wholesale is very hard for a $50B revenue business facing strong rival brands, less product control, price competition and channel conflict across multiple product lines. Nike may have a better near-term chance of beating estimates and is a more evergreen brand, but Lululemon looks increasingly preferable. x.com  x.com 

Lululemon is no bargain at $99 and an 8x P/E, with revenue shrinking 4% and guidance slashed in two consecutive quarters. x.com 

Lululemon looks headed out of business as its customers move to Alo, and another earnings report hammered the stock. Suburban women now wear Alo, at least until they switch to the next shiny brand in a few years, which is why retail apparel is not a long-term investment. x.com 

Lululemon is an 800lb gorilla worth defending despite bad management and the politics around its skin-tight leggings. x.com 

Brands have no moat, only heat cycles, and Lululemon, at new 8-year lows alongside Nike at 12-year lows, is cooling. People will always buy new clothes to look good, but that requires freshness, and another pair of Lululemons no longer delivers it the way it did in 2020. Winning means spotting which stage a brand is in. x.com  x.com