Lululemon Athletica: Mixed Market Signals Prompt Hold Rating Amid Promotional Pressures and Volatile Growth
In a report released yesterday, Brooke Roach from Goldman Sachs maintained a Hold rating on Lululemon Athletica, with a price target of $180.00.
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Brooke Roach has given his Hold rating due to a combination of factors influencing Lululemon Athletica’s current market position. The company is facing mixed trends, with some positive indicators such as increased store traffic in October and improved consumer sentiment on social media. Additionally, the new partnership with Amex Platinum is expected to provide some tailwinds.
However, there are challenges that temper the outlook. The brand is experiencing increased promotional activity, which could impact profitability. In China, while sales growth on platforms like Tmall, JD, and Douyin has accelerated, there is a decline in brand search interest amid a volatile macroeconomic environment. Given these mixed signals and the lack of clear evidence for a sustained reacceleration in growth, Brooke Roach maintains a Neutral stance on the stock.
In another report released yesterday, UBS also maintained a Hold rating on the stock with a $183.00 price target.
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