UBS said Lululemon’s U.S. sales momentum through August month-to-date has been “lackluster,” generating just 1% U.S. sales growth in the second quarter.
Lululemon Athletica (LULU) witnessed multiple brokerages trimming their price targets on the stock, with UBS noting that it expects the sportswear maker to lower its annual profit per share guidance due to tariffs and cost-related headwinds.
UBS cut its price target on Lululemon to $240 from $290 and maintained a ‘Neutral’ rating, according to TheFly. Lululemon’s U.S. sales momentum through August month-to-date has been “lackluster,” generating just 1% U.S. sales growth in the second quarter, UBS said.
However, shares of the company were up over 3% during early trading on Monday. Retail sentiment on Lululemon improved to ‘extremely bullish’ from ‘bullish’ a day ago, with chatter at ‘normal’ levels, according to Stocktwits.
TD Cowen also cut its price target on the stock to $298 from $321 while maintaining a ‘Buy’ rating, according to TheFly. The firm said Lululemon’s stores and e-commerce face a tougher macro environment and competition. TD Cowen added that merchandising and design in non-core categories at times appear outside the scope of what Lululemon has excelled at, leading the firm to lower its estimates below consensus.
Lululemon said in June that for 2025, it expects net revenue to be in the range of $11.15 billion to $11.30 billion, representing growth of 5% to 7%. The company expects earnings per share (EPS) to be between $14.58 and $14.78 for the year.
Lululemon’s shares have lost nearly 50% of their value so far this year and have declined over 20% in the last 12 months.
For updates and corrections, email newsroom[at]stocktwits[dot]com.<