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Research Alert: CFRA Raises Opinion On Shares Of Lululemon Athletica To Strong Buy From Buy
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Research Alert: CFRA Raises Opinion On Shares Of Lululemon Athletica To Strong Buy From Buy
Mar 22, 2024 5:54 AM

08:15 AM EDT, 03/22/2024 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We maintain our 12-month price target of $550, based on 37.9x our FY 25 (Jan.) EPS estimate and below the company's 5-year average forward P/E multiple of 42.7x. We maintain our FY 25 EPS estimate of $14.50 and initiate our FY 26 EPS estimate at $17.00. LULU posts normalized Q4 EPS of $5.29 vs. $4.40, $0.27 above consensus estimates on revenues of $3.21B vs. $2.77B and $8M above estimates. By region in Q4, Americas revenue increased 9% Y/Y and International revenue increased 54%. Q4 adjusted gross margin expanded 200 bps to 59.4%. LULU opened 25 new company-operated stores in the quarter, bringing the total to 711. LULU guided for revenue growth of 11% to 12% and EPS of $14.00 to $14.20 for FY 25, which we believe is conservative. Inventory declined by 9% to $1.3B compared to $1.4B in Q4 2023. Shares of LULU were down 10% in after-hours, which we believe is a great buying opportunity and leave shares trading under 30x our FY 25 EPS estimate and at the low end of its 5-year range.

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