Based on the aggregated intelligence of 130,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, yoga gear retailer Lululemon athletica
With that in mind, let's take a closer look at Lululemon's business and see what CAPS investors are saying about the stock right now.
Lululemon facts
|
Headquarters (founded) |
Vancouver, Canada (1998) |
|
Market Cap |
$875.6 million |
|
Industry |
Apparel Clothing |
|
Trailing-12-Month Revenue |
$353.5 million |
|
Management |
Founder/Chairman Dennis Wilson President/CEO Christine Day |
|
1-Month Price Change |
94% |
|
Competitors |
Nike
Under Armour |
|
CAPS members bearish on LULU also bearish on |
Overstock.com
D.R. Horton |
|
CAPS members bullish on LULU also bullish on |
Apple
Google |
Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS.
Over on CAPS, fully 86 of the 418 members who have rated Lululemon -- some 20.5% -- believe the stock will underperform the S&P 500 going forward. These bears include robertshrestha and All-Star fmahnke, who is ranked in the top 6% of our community.
Just yesterday, robertshrestha raised a red flag over Lulu's recent (massive) run-up: "Too far, too fast. At a P/E of +20, Lulu's faddish characteristics are just too risky to take on. Yoga seems to have peaked, anyway."
In a pitch from last week, fmahnke elaborates on Lulu as an overvalued lemon:
I've owned this stock on the long side in the $6-$7 dollar range as it's represented an good buy based on its growth. … The problem is that it is now trading at an [forward P/E] of 27 despite the fact that revenues declined last qtr. compared to the prior year and are expected to decline by 8% next quarter. Additionally they had a huge build in inventory (which could lead to future writedowns) and will likely face increased competition from larger competitors offering similar products at a lower price through better developed distribution channels.
What do you think about Lululemon, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 130,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.
