Lululemon's stock falls ahead of results, but analyst expects another 'robust' beat and raise
Shares of Lululemon Athletica Inc. fell 1.2% in afternoon trade Thursday, ahead of the yoga-gear maker's fiscal second-quarter results due out after the close. Analyst Camilo Lyon at Canaccord Genuity kept his rating at hold, but boosted his price target by 35% to $131, saying he expects another "robust" beat of expectations and a raised outlook. He said Lululemon's same-store sales for the quarter likely rose in the mid-to-high teens percentage range from a year ago, while the FactSet consensus is for 9.6% growth, as he believes demand trends have not slowed. He also expects gross margin expansion to exceed guidance, translating into earnings per share that is 7 cents to 9 cents above expectations. The company has beat EPS expectations that past five quarters, according to FactSet, and the stock has gained an average of 10.1% the day after results were reported during that streak. the stock has run up 29.7% over the past three months, while the S&P 500 has tacked on 6.9%.
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