Just thought I'd add my 2 cents I rarely post on these boards. I'm a member of crossfit, which as some of you may know is a gym with workouts in small class settings. It is absolutely expoding and Lululemon is becoming one of the brands of choice not just for girls but guys also. The trainers have even hyped it up a bit. A lot of my friends over the last few months have been hearing about the brand and absolutely love the workout clothes. I expect there to be a lot of growth, as I'm sure many analysts are, but thought I'd just add my 2 cents. Good luck to everyone.
Stick to excercising sweet pea. Investing is about getting more cash out later and buying things CHEAP(warren Buffet stresses CHEAP). What is cheap about lululemon let alone undervalued at all? The company is trading at an 11B valuation, 42 p/e, 270M in earnings, SLOWING GROWTH YOY the last 5 years(despite high growth rate), increasing competetion, nothing propietary, hardly any REAL brand name value compared to companies like Nike and Under Armour.
Those who plan on investing LONG TERM with this company will be lucky to have half their money in 5 years from now. A return? No way. Unsustainable. Wall street can remain irrational longer than most can stay solvent, and this comany has been notorious for its short squeezes, but the higher goes, the faster it is going to correct and OVER-CORECT as everyone looks for an available seat once the MUSIC stops.
It may not stop tomorrow, or next week, but in the next 5-10 years, music will stop. Welcome to the world of investing.
John - Good post. You're right. it is OverValued but not showing OverBought just yet. I will be in put trades when I see that on the TA . Just biding my time until the insane upticks complete their move. This drops quickly when selling pressures begin. When it does drop I believe 20% is going to be pretty easy down. LULU is a good company but not at these prices. Maybe at $50. Do your own DD and make your own decision. I believe you've got this correct John. When sell in May hits, this is one of my choice trades. Good trading to all. A word of advice to all; Dont fall in love with your positions or a company. We're here to make money and this market is very volatile and our economy is still in the toilet with all the QE debt. It's your money. Trade smart and dont let WS take you down like they do with great expertise!
I'm already up over 30% on the stock so I'll keep on investing as I see fit. I'm assuming you're a short and being that the stock is close to it's near the 52 week high you can't say that about yourself can you. No need to be bitter.... To argue your point there are only 190 stores so there is plenty of room to grow just by opening new locations in untapped markets... There is enormous untapped growth both internationally/domestically as well as the relatively untouched Men's market in the clothing, which they are starting to succeeed in and comete with the NIkes and Under Armours of the world. If you don't see that your missing something. Yes the PE is high, but there is a huge market to be had. Their product line will just continue to expand as well as their revenue base and profits..Sorry for your loss on investment.