With a market cap of $39.1 billion, lululemon athletica inc. (LULU) is a global technical athletic apparel, footwear, and accessories company. Based in Vancouver, Canada, the company operates its business through different channels in each market, including company-operated stores, e-commerce, temporary locations, wholesale, outlets, a re-commerce program, and license and supply arrangements.

Shares of LULU have underperformed the broader market over the past 52 weeks. LULU has dropped 3.4% over this period, while the broader S&P 500 Index ($SPX) has gained 12.5%. Moreover, shares of LULU are down 15.4% on a YTD basis, compared to SPX’s 1.4% return.

Zooming in further, lululemon has also lagged behind the Consumer Discretionary Select Sector SPDR ETF Fund’s (XLY) 21.5% rise over the past 52 weeks and 3.2% decline on a YTD basis.

lululemon athletica stock crumbled 14.2% following the release of its Q4 2024 on Mar. 27. Quarterly revenue rose 12.7% year-over-year to $3.6 billion. Its EPS came in at $6.14, up 16.9% from the year-ago quarter, surpassing the analysts' estimate by 5%. During the quarter, Lululemon opened 18 net new company-operated stores, bringing its total to 767. 

Despite the strong results, shares fell sharply due to disappointing guidance for fiscal 2025. The company expects net revenue between $11.15 billion and $11.3 billion, representing growth of 5% to 7%, or 7% to 8% when adjusted for the extra week in fiscal 2024. Full-year EPS is projected to range from $14.95 to $15.15, falling short of investor expectations. 

For the fiscal year ending in January 2026, analysts expect LULU’s EPS to increase marginally year-over-year to $14.77. The company's earnings surprise history is solid. It beat the consensus estimates in the past four quarters. 

Among the 31 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on 15 “Strong Buy” ratings, two “Moderate Buys,” 11 “Holds,” one “Moderate Sell,” and two “Strong Sells.”

This configuration is slightly more bullish than three months ago, with 14 “Strong Buy” ratings on the stock.

On May 12, Barclays analyst Adrienne Yih lowered LULU's price target to $276 while maintaining an “Equal Weight” rating on the stock. 

As of writing, lululemon athletica is trading below the mean price target of $348.53. The Street-high price target of $500 implies a potential upside of 54.5% from the current price levels.