Lululemon’s premium merchandise is priced high in the apparel market. Sales growth has slowed, but China’s demand remains strong. Investors eyeing contrarian picks may find Lululemon appealing due to its low valuation. Despite past success, the stock has dropped 68% from its peak in December 2023.

Lululemon caters to the premium end of the apparel market with technical fabrics. The company’s gross margin averages 57.6%, higher than Nike. Recent revenue growth has slowed significantly, with fiscal 2024 showing only a 10% increase and Q2 2025 up by 7%.

While U.S. sales remain flat, China’s revenue has surged by 25%. Lululemon continues to expand its presence in China. The stock has plummeted 51% in the last five years, contrary to the S&P 500’s growth. Despite this, the company still maintains profitability.

Lululemon, while facing market pessimism, continues to grow revenue and remains profitable. The brand maintains consumer appeal. With a low P/E ratio of 11.2, contrarian investors may see an opportunity for growth. The market could potentially revalue shares higher with improved financial results.

Read more at Yahoo Finance: Read This Before Buying Lululemon Athletica Stock