3 Areas Lululemon Investors Must Watch

In the video below, Fool analysts Isaac Pino and Jeremy Bowman discuss some areas that investors in lululemon athletica (NASDAQ: LULU  ) must keep an eye on in coming quarters.

Same-store sales is always a key figure to watch in retail, especially with a fast-grower like Lululemon, Jeremy says. The company has left investors with nothing to complain about so far. Last quarter showed 18% growth, and growth over the past six quarters has averaged 15%. If that figure starts to shrink, it could be a red flag, Jeremy says.

Availability of the brand is a second concern. The company, which started in Canada, has begun expanding into new markets overseas. So far, it has seen good results with its Hong Kong store. That expansion will be key to its growth.

Competition is the third area to watch. Other clothing retailers have noticed that Lululemon has carved out a niche market and are coming after the company with their own athletic brands targeting women.

Those competitors could take some of that market and slow Lululemon's growth, the analysts say.

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