Lululemon (LULU) Valuation: Reassessing the Stock After a Tough Year and Recent Share Price Stabilisation
lululemon athletica (LULU) has been grinding through a tough stretch, with the stock down sharply this year even as revenue and profit still edge higher. This has left many investors reassessing what counts as a fair price.
See our latest analysis for lululemon athletica.
That disconnect is showing up in performance, with a roughly 7% 1 month share price return and a near 10% 3 month share price return, but a much weaker year to date share price return. This suggests recent momentum is stabilizing after a sharp reset in expectations.
If lululemon’s reset has you rethinking where growth might come from next, it could be worth scanning high growth tech and AI names through high growth tech and AI stocks for fresh ideas.
With shares down sharply over the past year, even as sales and profits inch higher, investors are left debating the setup: is lululemon quietly undervalued here, or is the market already pricing in every ounce of future growth?
Most Popular Narrative Narrative: 4.2% Undervalued
With lululemon athletica’s fair value pinned at about $190 versus a last close of $182.28, the current setup implies modest upside if the narrative plays out.
Ongoing investments in digital commerce, technology (including new AI initiatives), and omnichannel capabilities aim to enhance customer personalization and operational agility, which should better capture shifting consumer behaviors and support both revenue growth and margin efficiency.
Curious how steady but not explosive revenue growth, softer margins, and a lower future earnings multiple can still justify upside from here? The narrative’s maths may surprise you.
Result: Fair Value of $190.19 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, softer U.S. demand and mounting tariff pressures could still derail margin recovery and earnings growth, which could force another reset in expectations.
Find out about the key risks to this lululemon athletica narrative.
Build Your Own lululemon athletica Narrative
If you see the story differently or want to stress test the assumptions yourself, you can build a personalized view in just a few minutes: Do it your way.
A great starting point for your lululemon athletica research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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