But now you are seeing the pundits coming out and saying they don't think UA or NKE will buy LULU. The rumor has run its course, the run is over....look out below I think.
All that free money from the Federal Reserve looks daily for shorts to squeeze. Any rumor is good for at least a 10% immediate panic euphoria squeeze.
Where is the downgrade? or is that what the crystal ball between your legs is telling you will happen?
Sentiment: Strong Buy
Lulu is a great, great short squeeze candidate and a close above 55 will mean lots of short covering. As a matter of fact, this quick spurt up today was a bit of covering already but that is not what I am talking about.....I am waiting for the one starting at 55....going into earnings
Footgear: I think you are right....Lulu and UA are not a good mix. UA IS a boy's club but expertise could be brought in to manage a woman's line. On the flip side, Lululemon is actually not that good managing their business, those "women" at Lulu are seen as a weak management team by Wallstreet, getting lots of criticism for missteps.....I hope Lulu brings in new talent that better understands how to manage a giant business. The women who are there were GREAT building a business but now it is too big for their expertise. They should realize that the business has outgrown their skill sets.....hell, they should take their money and do it all over again
I think Lulu is being accumulated prior to earnings call and will head higher going INTO earnings...because retail pundits believe that Lulu will show that they have tackled the ONE issue they had during last quarter: excessive inventory on hand. Remember, there was nothing wrong with the earnings, it was all in the inventory on hand that caused the huge slide, even though the CEO explained why there was so much Luluwear was in stock. I think it will be a much prettier inventory picture and we know the rest of the Lulu story is solid....hell, even all this crazy aquisition talk by UA will drive this baby back toward 60. I have a mix of 22 Jan calls with strikes of 50 and 55. I am not going to spread them into earnings but going in bareback......I think I will come out on top on this one......
How much did you lose on your CRM short ?????????? sorry to see your Puts EXPIRING WORTHLESS ...... ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha
Sentiment: Strong Buy
I don't believe in UA going after a buyout of LULU simple because of all the investment they have made in the women's business over the past year but if they did it would be a disaster since UA is such a boys club they wouldn't know how to manage LULU...they struggle in women's period.....if you review the corporate head count you will see its not very diverse....all men
With LULU opening up the new store in NY I think that they are just fine as a brand on there own and considering they are continuing to grow the men's business double digits...grow is pretty good near term
STRONG BUY on LULU Brand not a take out
Sentiment: Strong Buy
4) Bloomberg article today "Nike's Road not taken" --this piece reeks of being a planted story by a banker for LULU. Timing is very interesting wouldn't you say. Basic point of the article is the NIKE could buy LULU with pocket change and jump start their lack of progress in the women s apparel market etc. ----------------------Lets talk about real world conspiracy----this article immediately made me think that Under Armor is coming after the company and the bankers are back channeling for a second bidder to drive the price higher (above 62). The timing of this article is hilarious and if you believe its a coincidence than your missing the manipulation that goes on behind the scenes in deals of this magnitude
3) Today. No Buy out weekly options aren't wiped out but do quite well with Nike and footlocker news. They weren't ten baggers with a buy out which one could argue that the type of buying yesterday were binary gambles for a large quick premium (buy out ) event.--------Now as those with experience know a deal is a cluster fk at the very end and getting it over the finish line is in most cases a very difficult last mile event. Having them extended or delayed is extremely common especially with bankers shopping for higher bidders etc... which brings me to the next more interesting point---
2) Article from insider monkey posted yesterday regarding Steve Cohen aggressively building a position in LULU---say what you want about Cohen but one thing he is good at is getting into stocks in front of buy outs (how that magically happens is of course is a great mystery). The point being the guy knows how to make money so his position in the company made the story even more interesting
1) Stock had a strong move yesterday with lots of aggressive option buying on out of the money strikes ---these were options expiring today which raised a lot of eyebrows---
please google for the story: "hearing unconfirmed market chatter of UA bid for Lululemon; 62/share" story on benzinga
Ahhhhh, finally.....I have 15 January 50 Strike Calls bought last week counting on exactly THIS....a price break back over 50. Lulu is a great candidate for a short squeeze as everybody piled on after the excess inventory announcement taking this stock for a huge tumble from 60 to a ridiculous 45 level.....It is still oversold and I look at this to go back to at least 55 before the Christmas holiday. Lulu is announcing earnings on Dec 9 and I am counting on good numbers AND improvement on inventory management.....This is a winner already as of today and will be a much bigger one come earnings day.....