Lululemon Athletica Inc. (LULU) Mentioned Positively at William Blair, 'Raising Estimates on Expectation of Robust Holiday Sales'

William Blair analyst Sharon Zackfia reiterated an Outperform rating on Lululemon Athletica Inc. (NASDAQ: LULU).

The analyst comments "We believe lululemon’s broad-based strength continued in December and expect its fourth-quarter sales and earnings outlook to be raised in tandem with the ICR Conference (to be held January 8–10). In contrast to last year, when severe winter weather curtailed last-minute traffic, both the U.S. and Canada experienced unseasonably mild weather prior to Christmas this year. Moreover, store traffic was robust during our pre- and post-Christmas checks, and similar to last year, there was little markdown activity prior to Christmas. Following Christmas, lululemon put out sale racks, in keeping with previous years, with in-store markdowns up roughly 30% versus the year-ago period, on a doubling of women’s markdowns and a midteens increase in men’s markdowns partly offset by a roughly 40% decline in accessories markdowns. Online markdowns in December increased about 25% year-over-year but only in the midsingle digits sequentially. All-in, we now expect revenue growth of nearly 16% in the fourth quarter (versus 15% previously and ahead of guidance of 13% to 14%), on a comp gain of about 13.5% (above consensus of 12.0% to 12.5%). As a result, we are increasing our fourth-quarter EPS estimate to $5.02, up 14% and ahead of consensus of $4.95 and guidance of $4.85 to $4.93"

For an analyst ratings summary and ratings history on Lululemon Athletica Inc. click here. For more ratings news on Lululemon Athletica Inc. click here.

Shares of Lululemon Athletica Inc. closed at $509.22 yesterday.

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