From Yahoo Finance: 2025-06-08 15:43:00

Lululemon athletica (NASDAQ: LULU) has been a top-performing consumer-facing stock, up 1,800% since its 2006 IPO. However, concerns about valuation, slowing growth, and the trade war have caused a 48% drop from its peak. First-quarter earnings saw a 1% growth in comparable sales, with revenue hitting $2.37 billion.

Guidance for the full year was maintained with revenue expected to be $11.15 billion to $11.3 billion, but earnings per share guidance was cut to $14.58-$14.78. Operating margin is expected to fall 160 basis points due to tariffs. Lululemon sees potential growth in China, with revenue there increasing 21% in the first quarter.

Despite challenges with tariffs, Lululemon remains optimistic about growth in China, where it currently has 154 stores. The company anticipates further expansion in the country. After a significant sell-off, Lululemon now trades at a forward P/E of 18, making it a possible buy for investors.

Lululemon’s challenges with tariffs are similar to other retailers, but the situation remains unpredictable. With a strong brand and growth potential in China, Lululemon appears to be a solid investment at its current price. Investors are advised to consider the company’s growth prospects and industry trends before making a decision.



Read more at Yahoo Finance: Down 48% From Its Peak, Is This Market-Crushing Growth Stock a Buy Now?