Lululemon (LULU) Selloff Not a Good Sign for Growth Stocks

Investors could be losing their appetite for growth stocks, as shown by Lululemon (Nasdaq: LULU) getting taken out Thursday following guidance that was less than what investors anticipated. The stock is now down more than 8 percent to around $64.39.

Lululemon has been a high flier recently, and shares are still up nearly 45 percent year-to-date. The fact that the stock is being sold amid a quarterly beat but reduced outlook could signal investor's taste for high growth names is increasingly being undermined by larger macro fears.

So far this year iShares S&P 500 Growth Index (NYSE: IVW) has outperformed the S&P 500 SPDRs by about 1.3 percent, but this trend could reverse if investors become averse to these growth names.

In the mean time, keep an eye on ETFs like the Columbia Large-Cap Growth Equity Strategy (NYSE: RWG), which has a 3.3 weighting in Lululemon. RWG also owns shares of priceline.com (NASDAQ: PCLN), salesforce.com (NYSE: CRM) and amazon.com (NASDAQ: AMZN).

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