Wedbush: Lululemon, Old Navy 'Traffic Winners' In Pre-Holiday Shopping Rush

According to Morry Brown of Wedbush, Lululemon Athletica (NASDAQ: LULU) along with The Gap (NYSE: GPS) owned Old Navy were “traffic winners” among specialty retailers.Brown commented in a note over the weekend that both retailers are “early seasons' winners” and continue to benefit from strong traffic and conversion trends. The analyst observed first hand lots of low inventory and out-of-stocks merchandise at both stores.Through the third week of December, Brown suggests a positive read-through for Lululemon due to popular gifting items including “Gift Guides” which consists of scarves, Sweat Happens Liner Bags, hoodies, jackets and yoga mats. “Our checks point to Lululemon as being a leader in traffic at the mall with some lines consisting of 30 plus people and an additional 20 plus people shopping the new inventory,” Brown wrote. However, the analyst adds that “select out of stocks, along with clearance inventory selling down, are likely indicators of the delivery issues management discussed related to West Coast port delays” and that this “could impact the company's decision on running its warehouse sale this year.”Brown also commented that Old Navy was a top pick for Black Friday weekend and that the momentum has continued since. The analyst states that “Old Navy traffic has remained at or near the top in the sector throughout December.”