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Lululemon Buoyed By 'Cult Following'

Lululemon Buoyed By 'Cult Following'
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Lululemon Athletica inc. (NASDAQ: LULU) shares breached $60 for the first time in almost four months on Tuesday, following the athleisure company's strong guidance report.

But investors worried about whether it's a viable play in a struggling retail industry needn't, at least according to retail expert Kristin Bentz. She thinks Lululemon is actually very well-positioned for the future.

"I get such grief from a lot of investors for being as positive as I am on the name," Bentz said on PreMarket Prep. "I think they have a lot of work to do, but they're doing some really cool stuff. If you watch very closely, they really know what they're doing."

Related story: Lululemon Has 'A Very Successful Holiday Season'

This includes going into high-fashion garments, creating one-off pieces that you can wear outside, and strengthening its men's collection. Bentz also liked its addition Swim, calling it "a logical brand extension for them."

Even within a space as crowded as athleisure, with everyone from Nike Inc (NYSE: NKE) to Victoria's Secret competing for market share, Lululemon stands out for Bentz.

"They have such a cult following within the athleisure space that I could see them, with the right guidance, developing into a lifestyle brand."

She continued, "It's a very crowded space...but I'm telling you, that lulu customer, it is such a cult following. It's like a snobbery within the yoga world. I think this company has a lot more room to grow as long as they are mindful and keep the quality up."

Catch the rest of Kristin's interview below. Listen to today's PreMarket Prep in it's entirety here, and join every morning from 8-9:30 a.m. ET for live trading ideas and analysis.

Posted-In: Kristin Bentz PreMarket PrepAnalyst Color Guidance Exclusives Interview Best of Benzinga


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