Morry Brown and Taryn Kuida, analysts at Wedbush, wrote, "We assign [...] a premium to the specialty retail peer set [...] given LULU's better real estate profile, higher unit growth rate, and higher returns on capital relative to peers [...] We believe the primary risk (increased competition) is unlikely to derail fundamentals in the near term (assuming solid execution)."
Related Link: Study Shows Lululemon Is Building Momentum
Looking Ahead To The Earnings Report
Lululemon will report earnings on Wednesday, December 9 before the market opens for trading. Wedbush expects Lululemon to report third-quarter earnings of $0.38 per share, above the consensus estimates of $0.35–$0.37 per share.
In the firm's investment thesis, Wedbush believes investors aren't fully valuing the company's international growth opportunity, as the company could expand operations in new markets of Europe and Asia in the next two years. Furthermore, analysts at Wedbush see potential for improving supply chain efficiency and investments in product design leading to the company increasing their profitability.
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Latest Ratings for LULU
| Nov 2015 | FBR Capital | Downgrades | Market Perform | Underperform |
| Oct 2015 | Wells Fargo | Assumes | Market Perform | |
| Oct 2015 | Credit Suisse | Upgrades | Neutral | Outperform |
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