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Lululemon is under pressure today after issuing weak guidance for the fourth quarter, despite posting earnings and revenue beats for the third quarter. Yahoo Finance's Alexis Christoforous, Brian Sozzi, and Emily McCormick discuss on The First Trade.
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lululemon (LULU) delivers solid third-quarter fiscal 2019 results on positive customer response to merchandise assortments as well as continued investments to drive business growth.
(Bloomberg) -- Lululemon Athletica Inc. fell by the most in more than six months on Thursday, after the yoga-wear maker’s fourth-quarter comparable sales forecast disappointed traders. The shares hit a record high Wednesday before the earnings report.Analysts were broadly positive on the quarterly results and called the forecasts “conservative.” Estimates for sales and earnings were increased, and a number of firms also boosted their share-price targets. Bloomberg Intelligence’s Poonam Goyal wrote that “while management’s fourth-quarter EPS outlook is short of consensus at its midpoint, it may have upside if the pace seen over Thanksgiving weekend and limited markdowns carry through the quarter.”Stifel’s Jim Duffy sought to clear up the fourth-quarter misconception for his clients, telling them that the consensus estimates ahead of Wednesday’s report “failed to properly account for lapping the 14th week and having six fewer selling days between Thanksgiving and Christmas.”Shares fell as much as 6.4%, the biggest intraday drop since May 29, paring the year-to-date advance to 80%.Here’s more of what analysts had to say following the results:Susquehanna, Sam PoserThe “impressive” 3Q results, “up and down the P&L,” are evidence that “momentum, driven by PEP (Product, Engagement, Process), is in full swing,” the analyst wroteBelieves there is upside potential to Lulu’s raised, but still conservative, year forecast“Despite the 3Q19 beat and raise, exceptionally high expectations (likely above Street estimates) heading into the print and an ~15% run-up in the stock since the 2Q19 print in September are resulting in downward pressure on the stock”Poser doesn’t believe the weakness is a “reflection of declining fundamentals,” and sees momentum continuing “for the foreseeable future”Rates positive, raises price target to $260 from $222What Bloomberg Intelligence Says:“Lululemon’s momentum, driven by an appetite for experience and mindfulness, with innovation in fabric, should extend into 4Q with the potential for same-store sales to gain more than the projected low-double-digit range,” analyst Poonam Goyal wrote in a noteShe believes the company’s expectations for double-digit earnings gains through 2023, fueled by margin expansion and low-teens sales growth, “could prove conservative as personal care, experiential retailing and footwear spur sales.”Cowen, John KernanThere is “so much to like” with Lulu, Kernan wrote, noting that the company “continues to produce not only a sector best,multi-category product cycle, but also is forming some of the deepest connections with consumers in the entire global athletic, softlines industry through great product and experiences”He believes Lulu’s sales and margin trajectory indicate that the fourth-quarter forecasts appear “conservative”Management appears “increasingly confident” in China and Europe, “with emerging stores and brand activations across Tier II China as well as Paris”Rates buy, price target $250Stifel, Jim Duffy“Some may mistakenly interpret” the fourth-quarter comparable sales guidance for low double-digit growth (constant currency) as a “sharp deceleration,” but Duffy noted that with the year ago’s 14th week and six fewer holiday shopping days this year, the forecast is an “endorsement of momentum”Remains bullish on the prospects for return on growth investments, and sees the stock as “deserving of a premium multiple”Rates buy, price target $273RBC Capital Markets, Kate FitzsimonsContinues to see upside to comparable sales and earnings into the fourth quarter and next year, with “slight multiple expansion as the brand leverages its innovation and customer engagement focuses”“We would be buyers on any short-term weakness given Lulu’s open-ended growth story”Rates outperform, price target $250CFRA, Camilla Yanushevsky“Strong profit reports have become the norm for Lulu and, as expected, Lulu posted another solid quarter with stellar comps and robust gross margin expansion”The U.S. consumer “may be running out of steam,” but Lululemon is “full steam ahead”Maintains buy rating, price target to $255 from $220B. Riley FBR, Susan Anderson“We are impressed with LULU’s ability to continue to “innovate and create newness with a solid new product pipeline, which is driving market share gains”Growing men’s business, category expansion, and international growth should continue to drive “solid revenue growth over the next several years”Maintains her neutral rating, awaiting a better entry point; lifts price target to $218 from $182(Updates to reflect regular session trading in first and fourth paragraphs, and chart)To contact the reporter on this story: Janet Freund in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Catherine Larkin at email@example.com, Scott SchnipperFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Lululemon Athletica stock tumbled in after-hours trading on Wednesday, as the company reported third-quarter earnings that beat Wall Street forecasts but presented fourth-quarter guidance that was at the low end of expectations.
Lululemon stock continues to outperform in the retail sector thanks to strong earnings and sales in recent quarters. But does that make LULU stock a buy?
Futures: Lululemon Athletica fell late on weak guidance after Apple and chips led Wednesday's stock market rally. Thursday night's Adobe, Broadcom and Costco earnings will be key.
Most analysts are confident of the chain's ability to sustain its performance. But as always, look out for the risks.
I had anticipated more volatility following earnings, but LULU bounced from the after-hours lows too quickly to create any hedge -- here's how it may work out going forward.
Jim Cramer and ActionAlertsPLUS.com research analyst Zev Fima are breaking down everything you need to know about the markets from the latest on the China trade negotiations to Real Money Stock of the Day Lululemon . Does the U.S. Need a China Trade Deal? As the December 15 tariff deadline gets ever-closer, Jim Cramer took his latest column on Real Money to take to ponder if the U.S. should even continue pursuing a trade deal with China.
With the Federal Reserve holding steady on interest rates, investors now turn to the stalled U.S.-China trade talks.
The Fed doesn't know what will happen, and they most certainly don't know what they will do in response when the worm does indeed turn.
U.S. stock futures rise modestly after the Federal Reserve leaves interest rates unchanged, and as investors await results from the U.K. election and stalled U.S.-China trade negotiations; Adobe, Oracle and Broadcom report earnings; Lululemon slumps on soft fourth-quarter guidance; General Electric is rated a buy at UBS.
Lululemon topped Street forecasts for third quarter sales and profits, but softer guidance into the final months of its fiscal year has shares on the back foot heading into the start of trading Thursday.
Lululemon (LULU) delivered earnings and revenue surprises of 3.23% and 1.87%, respectively, for the quarter ended October 2019. Do the numbers hold clues to what lies ahead for the stock?
(Bloomberg) -- Lululemon Athletica Inc. reported another quarter of double-digit sales growth -- but that wasn’t enough to boost a stock that’s already almost doubled this year. Shares fell in late trading.Lululemon sees profit of $2.10 to $2.13 a share in the fourth quarter, below analysts’ estimate of $2.13 a share. Meanwhile, the closely watched metric of comparable-store sales rose 17% on a constant-currency basis in the latest quarter, beating the 14.2% estimate compiled by Consensus Metrix. That represents eight straight quarters of double-digit growth for the measure.Key InsightsDespite its 11th consecutive profit beat, the Vancouver-based company is suffering from investors’ expectations for perfection. Citigroup analyst Paul Lejuez warned in October that “the market expects results to be flawless, leaving little room for disappointment.”Consumers’ appetite for the brand’s $178 cardigans and $98 yoga pants is growing online, where comparable sales increased 30%, when adjusted to exclude currency effects. Lululemon has revamped some of its websites and is adding others as it expands overseas. But since these sites relatively young, comparisons may be getting tougher going forward.Chief Executive Officer Calvin McDonald told analysts he sees significant opportunities to further expand in China after doubling its store base this year. E-commerce grew more than 60% there during the quarter, with a surge in business on Singles Day that surpassed last year’s volume after just 69 minutes, he said.Investors may be concerned by the upcoming departure of Chief Operating Officer Stuart Haselden, a key member of management who was in charge of international expansion. The company won’t rush into finding a replacement for Haselden and will seek someone with experience in the Asia-Pacific region, McDonald said.Market reactionLululemon shares fell as much as 7.8% in late trading, before paring some of the decline. The stock has advanced 92% this year through Wednesday’s close.For company statement, click here.(Adds CEO comments on China in third bullet under Key Insights.)To contact the reporter on this story: Sandrine Rastello in Montreal at firstname.lastname@example.orgTo contact the editors responsible for this story: David Scanlan at email@example.com, Jonathan Roeder, Sally BakewellFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Lululemon Athletica topped Q3 earnings forecasts late Wednesday but gave weak Q4 revenue guidance. Shares tumbled.
Lululemon Athletica Inc forecast profit for the all-important holiday quarter largely below analysts' expectations on Wednesday, sending the apparel maker's shares down 5% in extended trading. Lululemon had 46% of its apparel on sale on its U.S. website during the third quarter, compared with last year's 39%, according to brokerage UBS. Lululemon expects to earn between $2.10 and $2.13 per share in the fourth quarter.
Shares of Lululemon Athletica Inc. fell more than 5% in the extended session Wednesday after the apparel retailer reported an adjusted third-quarter profit below Wall Street expectations. Lululemon said it earned $126 million, or 96 cents a share, in the quarter, compared with $94 million, or 71 cents a share, in the third quarter of fiscal 2018. Adjusted for one-time items, Lululemon earned 75 cents a share. Sales rose 23% to $916.1 million, Lululemon said. Analysts polled by FactSet had expected GAAP earnings of 94 cents a share and adjusted earnings of 93 cents a share on sales of $899 million. Lululemon said it expects fiscal 2019 net revenue between $3.895 billion and $3.910 billion, and EPS between $4.75 to $4.78 for the full year. The analysts surveyed by FactSet expect an adjusted EPS of $4.75 on sales of $3.891 billion. Shares of Lululemon ended the regular trading day
Chief Financial Officer Patrick Guido said on a post-earnings conference call the company would have to invest in developing new sports bras and accessories to keep up with investors' growth expectations. Known for its $100 yoga pants, Lululemon has dominated the market for pricey, fashion forward athleisure, but this year has faced competition from cheaper yet similar products from companies such Sweden's H&M . Lululemon said it expects to earn between $2.10 and $2.13 per share in the fourth quarter, while analysts on average had expected $2.13.
Lululemon Athletica Inc (NASDAQ: LULU ) shares are dropping despite reporting a third-quarter earnings and sales beat. Earnings came in at 96 cents per share, beating estimates by 3 cents. Sales came in ...