It's extremely difficult to create a successful clothing business. Not only is competition incredibly fierce -- since customers essentially have an unlimited number of shopping choices at their disposal -- but building a durable brand is a tough challenge. Consumer tastes are constantly changing, so what's popular today might not be in the future. 

A business that has thrived despite the industry's inherent obstacles is none other than athleisure pioneer Lululemon Athletica (LULU -0.75%). Once known only for its women's yoga pants, the company has developed into a full-blown lifestyle enterprise, and investors need to pay attention. 

Lululemon's shares are down about 18% in 2022. But despite the poor performance, this unstoppable apparel company is my top growth stock to buy right now. 

Weathering the storm 

While many companies face dramatic slowdowns as a result of the worsening macroeconomic picture, Lululemon continues posting outstanding financial results. In the latest fiscal quarter (ended July 31), the business saw revenue and same-store sales soar 29% and 23%, respectively, year over year. And diluted earnings per share were up 42% compared to Q2 2021. For the just-ended quarter, management expects sales to jump 23% to 24% from the prior-year period, signaling no meaningful deceleration in the business. 

Lululemon is a very profitable enterprise, too. Over the trailing-12-month period, the company generated operating profits of $1.5 billion on $7.1 billion of revenue, good for a 21.6% margin. And Lululemon's gross margin is superb, coming in at 56.5% in the most recent quarter. That's better than the likes of Apple, Ferrari, and Starbucks. 

A wide gross margin allows Lululemon to better handle the inflationary environment and the impact it may have on the company's cost structure. What's more, it demonstrates customers' willingness to pay up for what they deem to be a quality product. That's a favorable position for Lululemon. 

A strong brand 

Lululemon's remarkable success over the past 15 years has been surprising, given just how competitive the apparel industry is. Direct rivals like Nike, Adidas, and Under Armour, offer consumers high-quality merchandise similar to Lululemon's. But Lululemon has carved out a niche at the premium-priced end of the apparel spectrum. 

The business has built up a powerful brand, not by relying on expensive endorsements with major professional athletes, like its competitors do, but with a community-based approach. Lululemon hires ambassadors in the various communities it serves to promote and build a local, grassroots following for the brand. Events and workout classes are also offered. The result is deeper engagement and more meaningful connections with its potential customer base -- and clearly great financial success, too. 

Ambitious goals

Investors would be mistaken to think that Lululemon's past growth is coming to an end. Earlier this year, management, led by CEO Calvin McDonald, laid out a five-year financial plan. They set a clear target to reach $12.5 billion in sales by fiscal 2026, which would be roughly double fiscal 2021's revenue. That's solid growth on the horizon that shareholders can get excited about, despite any near-term uncertainty in the macroeconomic environment. 

To achieve this financial goal, there will be three key areas of focus. Management wants to double digital and men's sales, while quadrupling the international business. What's outstanding is that Lululemon already generates 42% of revenue from digital channels, so a greater focus on omnichannel going forward is nice to see. Furthermore, pushing for growth in the men's segment will help the brand broaden its appeal, a far cry from when Lululemon mainly sold popular yoga pants to women. 

And touching on international, right now the company gets 83% of its revenue from the U.S. and Canada. Compare this to Nike with 57% of fiscal 2023 first-quarter (ended Aug. 31) sales coming from outside North America. This means Lululemon has a massive opportunity to take market share in foreign markets, particularly in China, where the business currently operates 79 stores. 

With solid recent results, a powerful brand, and excellent growth prospects, Lululemon stock definitely merits a closer look from investors.