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Lululemon (LULU) Stock Sinks As Market Gains: What You Should Know

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Lululemon (LULU - Free Report) closed the most recent trading day at $324.10, moving -0.53% from the previous trading session. This change lagged the S&P 500's daily gain of 0.36%.

Heading into today, shares of the athletic apparel maker had gained 2.47% over the past month, outpacing the Consumer Discretionary sector's loss of 8.01% and lagging the S&P 500's gain of 5.21% in that time.

Investors will be hoping for strength from LULU as it approaches its next earnings release. The company is expected to report EPS of $0.90, up 309.09% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $1.11 billion, up 70.98% from the prior-year quarter.

LULU's full-year Zacks Consensus Estimates are calling for earnings of $6.48 per share and revenue of $5.66 billion. These results would represent year-over-year changes of +37.87% and +28.5%, respectively.

Investors should also note any recent changes to analyst estimates for LULU. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 2.58% lower. LULU is holding a Zacks Rank of #3 (Hold) right now.

Digging into valuation, LULU currently has a Forward P/E ratio of 49.83. This valuation marks a premium compared to its industry's average Forward P/E of 21.97.

Meanwhile, LULU's PEG ratio is currently 2.72. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Textile - Apparel was holding an average PEG ratio of 2.38 at yesterday's closing price.

The Textile - Apparel industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 67, which puts it in the top 27% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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