Lululemons' Pending Q2: A Refocus On Fundamentals

Loading...
Loading...
Lululemon Athletica Inc.'s
LULU
second-quarter results expected Sept. 11 are likely to show a continued decline in same-store sales at a time when investors are focused on stabilization of that performance measure, according to an analyst. "Fall merchandise sets have improved, but we don't think it's enough to turn around same-store sales in the third quarter," Stiefel analyst James Duffy said in a note Friday. Stabilized comps might materialize in the fourth period, according to Duffy. Duffy, who maintains a Hold rating and $40.59 target, said the recent acquisition of a $845 million stake by Advent International Capital from controversial founder Chip Wilson "should quiet M&A chatter and move the focus back on fundamentals." But fundamentals look a little shaky: Wall Street expects adjusted earnings to fall 59 percent to $0.29 cents a share, on a sales decline of 45 percent to $376.9 million from a year earlier. Year-to-date, Lululemon shares are down more than 32 percent, although they've gained a bit since the Aug. 8 Advent investment. DA Davidson's Andrew Burn on Thursday downgraded Lululemon to to Neutral from Buy. Burn thinks the Street consensus for 2015 earnings is too "aggressive." Results next year will be hurt by the company's spending on international expansion as well as stagnant "store productivity" and increasing competition, Burns said in a note. Lululemon traded recently at $39.90 a share, down 1.7 percent.
Loading...
Loading...
Date
ticker
name
Actual EPS
EPS Surprise
Actual Rev
Rev Surprise
Posted In: Analyst ColorEarningsNewsGuidanceDowngradesPrice TargetReiterationAnalyst RatingsApparel, Accessories & Luxury GoodsConsumer Discretionary
We simplify the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!

Loading...