11:24 AM EDT, 06/09/2025 (MT Newswires) -- Lululemon Athletica's ( LULU ) comparable sales in the Americas is likely to remain under pressure as "newness" wasn't able to inflect fiscal Q1 comps, Morgan Stanley said in a Monday note.

"We think the Americas business is being impacted by more than newness - some fixable and some not," the investment firm said. According to Morgan Stanley, these other factors could include increased competition, long product replacement cycles, and store size and layout constraints, among others.

Morgan Stanley said Americas comparable sales is the key performance indicator for the company's stock and equity appreciation is also likely to be challenging even with profitability outperformance in fiscal Q2 or the full fiscal year.

Morgan Stanley downgraded Lululemon Athletica ( LULU ) to equalweight from overweight and cut its price target to $280 from $346.

Shares were down 1.2% in recent trading.

Price: 262.20, Change: -3.07, Percent Change: -1.16