UPDATE: Sterne Agee Downgrades Lululemon Athletica to Neutral on Production Problems

Sterne Agee downgraded Lululemon Athletica

from Buy to Neutral. Sterne Agee analyst Sam Poser wrote, "We are lowering our estimates in 1Q13 & 2Q13 from $0.43 & $0.44 to $0.40 & $0.42 following LULU's press release last night stating that due to quality issues the company had pulled all black Luon women's bottoms from the stores. […] We suggest a wait and see mode until the Luon pant problem is resolved. There does not appear to be anything wrong with the core values of LULU. However, there does appear to be a major quality control problem in Asia, where the Luon pants are produced." Lululemon Athletica closed at $65.90 on Monday.