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Started By
Message
Lululemon drops $10.54 a share in one day despite beating estimates
Posted on 9/11/15 at 7:45 am
Posted on 9/11/15 at 7:45 am
I usually don't buy stocks that don't pay dividends, but I've been thinking about getting some of this one.
I like their product...yoga pants. I figure my dividends can be watching women's jiggily rear ends when they walk while wearing their product.
Their earnings report beat estimates, but they are down because of the dock worker's strike on the west coast that backed up inventory.
They believe they can unload this inventory without having to markdown product.
What do you guys think?
I like their product...yoga pants. I figure my dividends can be watching women's jiggily rear ends when they walk while wearing their product.
Their earnings report beat estimates, but they are down because of the dock worker's strike on the west coast that backed up inventory.
They believe they can unload this inventory without having to markdown product.
What do you guys think?
Posted on 9/11/15 at 9:31 am to goodbuds
8 Billion dollar yogo pants company ? yikes... see their P/E ? .... it might go up, but at a quick glance my instincts say it's the type of company that has a lot of room the other way...
Posted on 9/11/15 at 9:33 am to Zilla
quote:
8 Billion dollar yogo pants company
WTF.....short short short short
Posted on 9/11/15 at 9:39 am to goodbuds
LULU has been on my watch list for a while. My sister spends all my parents money there. I own a few of their shirts and shorts which are really good quality/expensive for athletic gear, but then again, it seems people are wearing this stuff even when they don't work out.
I believe GAP, along with a few other companies are getting ready to launch their own brand which will create more competition.
But I like it because when i look around I see their logo everywhere and even noticed a good bit of guys wearing it recently... No homo.
I believe GAP, along with a few other companies are getting ready to launch their own brand which will create more competition.
But I like it because when i look around I see their logo everywhere and even noticed a good bit of guys wearing it recently... No homo.
Posted on 9/11/15 at 10:17 am to goodbuds
Looks like their forecast was a bit below analysts expectations which also may figure into the drop.
With the drop, their forward P/E looks more in line with the industry of specialty clothing retailers.
As long as the economy stays up, women will do yoga and wants to wear expensive yoga clothes.
If the economy slows, they will start wearing cheaper brands.
With the drop, their forward P/E looks more in line with the industry of specialty clothing retailers.
As long as the economy stays up, women will do yoga and wants to wear expensive yoga clothes.
If the economy slows, they will start wearing cheaper brands.
Posted on 9/11/15 at 10:46 am to Bearded_Chow25
quote:
But I like it because when i look around I see their logo everywhere and even noticed a good bit of guys wearing it recently... No homo.
Doesn't mean the corporate leadership knows how to run a company. The founder has always seemed like a meat-head doofus and he owns 27%. At least he hired a CEO.
Posted on 9/11/15 at 11:24 am to GaryMyMan
Id buy UA instead any day.
Lulu doesn't really have the potential in other market sectors and they will go out of style, like everything else except super high end shite like Chanel and LV etc.
Lulu doesn't really have the potential in other market sectors and they will go out of style, like everything else except super high end shite like Chanel and LV etc.
Posted on 9/11/15 at 12:17 pm to STLhog
Lulu has the same business model as those michael kors watches which explains why they are overvalued
Lululemon marketed themselves as status symbol elite yoga/athletic attire. They got huge because they created the market and they ran a scarcity business model so that there was a high demand. The issue though is that to sustain growth, they will have to sell in volume and selling in volume kills the "status symbol" aspect of their brand. On top of that, you have UA + others entering the market with quality products cheaper.
Lululemon marketed themselves as status symbol elite yoga/athletic attire. They got huge because they created the market and they ran a scarcity business model so that there was a high demand. The issue though is that to sustain growth, they will have to sell in volume and selling in volume kills the "status symbol" aspect of their brand. On top of that, you have UA + others entering the market with quality products cheaper.
Posted on 9/11/15 at 1:28 pm to GenesChin
quote:
On top of that, you have UA + others entering the market with quality products cheaper.
Not to mention Nike ain't going anywhere and will always have "some" status.
good points on the MK stuff though. That fad died a swift death.
Posted on 9/11/15 at 2:18 pm to Bearded_Chow25
quote:
see their logo everywhere and even noticed a good bit of guys wearing it recently... No homo.
Because they're not just a "yoga pants" label. I at the "expect analysts" in this thread making profound announcements about the stock and yet simultaneously can't even explain the brand correctly.
Posted on 9/11/15 at 2:39 pm to Zilla
quote:
see their P/E ?
Can people stop using P/E as some holy number. Its pretty stupid to use for growth stocks as earnings hopefully won't be terribly high since they should be spending that money to grow.
Posted on 9/11/15 at 2:47 pm to Mo Jeaux
quote:
Because they're not just a "yoga pants" label. I at the "expect analysts" in this thread making profound announcements about the stock and yet simultaneously can't even explain the brand correctly.
I don't really understand what you are trying to say... They sell everything from mens outerwear to luggage on top of yoga pants.
I was simply stating an observation I've noticed about their brand lately, not their stock. I guess all that analysis was pretty profound though.
Posted on 9/11/15 at 2:59 pm to Bearded_Chow25
gap us had a competitor for years already (athletica)
Posted on 9/11/15 at 7:52 pm to barry
I don't use it as a holy number. I do use it to do my own valuation analysis, along with other factors
Posted on 9/12/15 at 1:44 pm to barry
P/E is available for a reason...1 of many metrics to use to determine if there is some value at current levels... can also be used to quantify the growth expectations...great tool actually
Posted on 9/13/15 at 4:00 pm to barry
quote:
Can people stop using P/E as some holy number. Its pretty stupid to use for growth stocks as earnings hopefully won't be terribly high since they should be spending that money to grow.
Is there a comparative metric that you prefer to use for growth companies? Price to sales, maybe?
As long as people use something, and it's a rational, useful metric, I don't think the particular metric(s) is all important. But so much of the time (and not just here), people seem to be relying on gut feel or anecdotals. I try to use a cross section of fundamentals when selecting a longer term investment, including P/E, P/S, dividend history, free cashflow, etc. For trades, it's more about the shorter term technicals.
I might trade LULU. But it pretty well fits what I refer to as the "FFF" (female fashion fad), so I don't have it on any investment watchlists.
Posted on 9/14/15 at 9:47 am to Zilla
quote:
can also be used to quantify the growth expectations...great tool actually
Not really, no one is paying for earnings on a high growth stock. The earnings come later.
quote:
P/E is available for a reason...
yea it is, because it makes sense for non growth stocks who are trying to maximize their earnings.
Posted on 9/14/15 at 10:58 am to Mo Jeaux
quote:
Because they're not just a "yoga pants" labe
They are a yoga apparel with widespread alternative uses. They are a good company, that generally makes a high quality product and has appeal.
Lulu built a brand based on luxury status symbol. Being a publicly held company is pretty much a death sentence for them since investors love their home run growth stories. Growing into other markets would basically be signing up to be a firing squad target practice.
This is how the Michael Kors/Lulu etc stories work
1-Higher quality trendy product that appeals to upper middle class
2-Becomes status symbol based on quality & scarcity -> Everyone wants one
3-Company goes public based on growing brand
4-Investors drive up price based on previous growth + future growth projections
5-Required growth targets forces company to move into lower socioeconomic demographics
6-Company loses trendiness since everyone has product
7- Stock price drops like a rock
Lululemon cannot compete (at least at this point) with the logistical capabilities of Nike/UA/Addidas etc. So a drive for growth to lose their luxury symbol status would kill the brand
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