Comparative Study: Lululemon Athletica And Industry Competitors In Textiles, Apparel & Luxury Goods Industry

In the dynamic and cutthroat world of business, conducting thorough company analysis is essential for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating Lululemon Athletica LULU and its primary competitors in the Textiles, Apparel & Luxury Goods industry. By closely examining key financial metrics, market position, and growth prospects, our aim is to provide valuable insights for investors and shed light on company's performance within the industry.

Lululemon Athletica Background

Lululemon Athletica designs, distributes, and markets athletic apparel, footwear, and accessories for women, men, and girls. Lululemon offers pants, shorts, tops, and jackets for both leisure and athletic activities such as yoga and running. The company also sells fitness accessories, such as bags, yoga mats, and equipment. Lululemon sells its products through more than 680 company-owned stores in 19 countries, e-commerce, outlets, and wholesale accounts. The company was founded in 1998 and is based in Vancouver, Canada.

Company P/E P/B P/S ROE EBITDA (in billions) Gross Profit (in billions) Revenue Growth
Lululemon Athletica Inc 29.42 10.69 4.74 17.26% $1.02 $1.9 15.63%
Ralph Lauren Corp 19.24 4.22 1.72 11.2% $0.4 $1.29 5.55%
Tapestry Inc 10.75 3.68 1.49 12.7% $0.49 $1.49 2.92%
Levi Strauss & Co 68.33 4.13 1.36 -0.53% $0.04 $0.91 -7.77%
PVH Corp 10.27 1.25 0.74 5.34% $0.44 $1.5 0.05%
Capri Holdings Ltd 22.93 2.65 1 5.46% $0.17 $0.93 -5.62%
Columbia Sportswear Co 18.79 2.37 1.35 4.87% $0.17 $0.54 -9.37%
Kontoor Brands Inc 13.81 8.40 1.22 19.12% $0.09 $0.28 -8.45%
Under Armour Inc 7.36 1.31 0.51 5.36% $0.11 $0.67 -6.05%
Carter's Inc 12.08 3.27 0.94 12.82% $0.16 $0.42 -5.95%
Oxford Industries Inc 28.81 3.07 1.11 -10.11% $-0.06 $0.25 5.74%
G-III Apparel Group Ltd 7.50 0.82 0.43 1.89% $0.05 $0.28 -10.49%
FIGS Inc 44.75 2.42 1.80 2.73% $0.02 $0.1 0.01%
Movado Group Inc 13.18 1.16 0.91 2.39% $0.02 $0.1 -7.54%
Superior Group Of Companies Inc 31.11 1.42 0.50 1.81% $0.01 $0.06 -0.92%
Vera Bradley Inc 26.28 0.78 0.44 -0.71% $0.01 $0.07 -9.4%
Lakeland Industries Inc 20.03 1.04 1.07 2.14% $0.0 $0.01 11.59%
Average 22.2 2.62 1.04 4.78% $0.13 $0.56 -2.86%

When conducting a detailed analysis of Lululemon Athletica, the following trends become clear:

  • At 29.42, the stock's Price to Earnings ratio significantly exceeds the industry average by 1.33x, suggesting a premium valuation relative to industry peers.

  • It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of 10.69 which exceeds the industry average by 4.08x.

  • With a relatively high Price to Sales ratio of 4.74, which is 4.56x the industry average, the stock might be considered overvalued based on sales performance.

  • The company has a higher Return on Equity (ROE) of 17.26%, which is 12.48% above the industry average. This suggests efficient use of equity to generate profits and demonstrates profitability and growth potential.

  • With higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $1.02 Billion, which is 7.85x above the industry average, the company demonstrates stronger profitability and robust cash flow generation.

  • Compared to its industry, the company has higher gross profit of $1.9 Billion, which indicates 3.39x above the industry average, indicating stronger profitability and higher earnings from its core operations.

  • With a revenue growth of 15.63%, which surpasses the industry average of -2.86%, the company is demonstrating robust sales expansion and gaining market share.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio helps evaluate the capital structure and financial leverage of a company.

Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.

When assessing Lululemon Athletica against its top 4 peers using the Debt-to-Equity ratio, the following comparisons can be made:

  • In terms of the debt-to-equity ratio, Lululemon Athletica has a lower level of debt compared to its top 4 peers, indicating a stronger financial position.

  • This implies that the company relies less on debt financing and has a more favorable balance between debt and equity with a lower debt-to-equity ratio of 0.33.

Key Takeaways

For Lululemon Athletica in the Textiles, Apparel & Luxury Goods industry, the PE, PB, and PS ratios are all high compared to its peers, indicating a potentially overvalued stock. On the other hand, the high ROE, EBITDA, gross profit, and revenue growth suggest strong financial performance and growth potential relative to industry competitors.

This article was generated by Benzinga's automated content engine and reviewed by an editor.

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