Athletic apparel retailer lululemon athletica (NASDAQ:LULU) crushed it over the holidays. Its momentum during the period was so notable that management recently lifted his forecast for revenue, earnings per share, and comparable sales growth for its fiscal fourth quarter, which ends Feb. 2.

"We're excited by the momentum in our business over the holiday period with guests responding well to our innovative merchandise offerings," said Lululemon CEO Calvin McDonald in a press release about management's updated outlook for the period. 

The stronger-than-expected holiday period brought fresh attention to the stock, drumming up excitement for shares that were already on a tear. The stock's price surged 91% in 2019 -- and it's already up 4% year to date in 2020.

If you're new to this company and are looking for an overview of the stock, here's a great place to start.

A woman doing yoga

Image source: Getty Images.

Shares are not cheap

While the stock's run-up has been great for shareholders, for prospective investors who are only now considering whether or not to buy in, it has made the decision more difficult. Lululemon now has a price-to-earnings ratio of 56 and a price-to-sales ratio of 8.4.

Of course, it trades at a premium valuation for a reason. Consider its recent growth. In fiscal Q3 (the company's most recently reported quarter), revenue rose 23% and comparable sales rose 17% year over year. Further, management recently guided for comparable sales to rise at a rate in the mid- to high-teen percentages on a constant-dollar basis in fiscal Q4.

Analysts, too, are optimistic about Lululemon's earnings growth prospects. The consensus estimate is that the retailer's earnings per share will rise at a compound annual rate of 21% over the next five years.

Impressive strength internationally

While Lululemon is doing well in North America, with revenue rising 21% year over year in fiscal Q3, it's growing even faster elsewhere. The company's international revenue increased 35% year over year in fiscal Q3, management said.

Among the highlights from the international segment that management mentioned during the fiscal third-quarter earnings call were 29% year-over-year revenue growth in Europe and 60% growth in its China e-commerce business.

Significant e-commerce revenue

While Lululemon is primarily a brick-and-mortar retailer, it also has a substantial e-commerce business. Its e-commerce revenue in fiscal Q3 was $246.7 million, or 26.9% of total revenue. Online sales should continue to account for a rising share of total sales, as e-commerce revenue is growing much faster than non-e-commerce revenue. Total e-commerce revenue rose 30% year over year in fiscal Q3, compared to 20% growth for the rest of Lululemon's revenue.

Can this growth stock keep up its strong momentum and live up to investors' high expectations? The market will get its next update on the athletic apparel company when it reports fiscal fourth-quarter results during the first half of March. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.