KeyBanc Upgrades Lululemon Athletica Inc. (LULU) to Buy; See Three Incremental Sales Drivers in 2012

KeyBanc upgraded Lululemon Athletica Inc. (NASDAQ: LULU) from Underweight to Buy with a price target of $58.00.

KeyBanc analyst says, "We move from our rating to BUY as we believe higher instock levels will drive sustained profit growth in 2012. One of the primary tenents of our former pair trade [BUY Coach, Inc. (NYSE: COH)(BUY maintained) and UNDERWEIGHT LULU] implemented on August 19, 2011] was that the then 25x multiple point NTM P/E gap would shrink. Since our rating changes, COH has risen 35% and LULU has fallen 17% (vs. a +9% change in the S&P 500) – providing 3,617 bps of return. This is further amplified when using the intra-day low for LULU from yesterday, which would have provided 4,757 bps of return."

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 $47.17 yesterday.

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• KeyBanc Upgrades Innovage Holding Corp (INNV) to Overweight
• Jefferies Upgrades Fortescue Metals Group Ltd. (FMG:AU) (FSUGY) to Hold
• Nomura/Instinet Upgrades Sunway Healthcare Holdings (SUNMED:MK) to Buy