Mizuho Securities analyst Betty Chen reiterated a Neutral rating and lowered her price target on Lululemon Athletica Inc. (NASDAQ: LULU) to $50.00 (from $58.00) as below consensus forward guidance suggests further margin pressure amidst ongoing inventory concern.

Chen commented, "While improved QTD comp momentum (we believe +MSD-HSD) is encouraging, ongoing merchandise misalignment with sales may linger beyond 1Q given the magnitude of the variance and dampen the previously expected three points of margin recovery from supply chain initiatives. Moreover, we expect additional investments in supply chain, IT, and Int'l rollout may hamper the return of the EBIT margin to the L-M20s in the near-term."

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Shares of Lululemon Athletica Inc. closed at $52.16 yesterday.