10:46 AM EDT, 09/09/2025 (MT Newswires) -- Lululemon Athletica ( LULU ) has long-term value but is facing "execution concerns" in the US and a "highly competitive" athleticwear sector, KeyBanc said in a note emailed Tuesday.

Lululemon posted "mixed" Q2 results with revenue below market expectations and growth in the US "turning negative for the first time in several years" which partly led to a lowered guidance for 2025, the investment firm said.

Also, results will likely stay "challenged" in the near term as Lululemon takes steps to rebuild momentum, the note said, adding the actions the company is taking to correct course are "appropriate" but the benefits may take some time to happen.

Meanwhile, the "competitive landscape remains intense, and macro pressure adds in another layer of uncertainty," the investment firm said.

KeyBank downgraded Lululemon to sector weight from overweight.

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