What to Expect When Lululemon Reports Earnings

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Lululemon Athletica Inc. (NASDAQ: LULU) is scheduled to release its fiscal fourth-quarter financial results after the markets close on Wednesday. The consensus estimates from Thomson Reuters are $1.01 in earnings per share (EPS) and $783.56 million in revenue. In the same period of last year, Lululemon posted EPS of $0.85 and $704.28 million in revenue.

Lululemon had a strong holiday season in both its store and digital channels, but since then the stock has steadily receded. Even after the company updated its fourth-quarter guidance in a positive way, the stock still has fallen since January.

At that time, the company said that it anticipates that net revenue will be in the range of $775 million to $785 million. That forecast is based on the company’s total comparable sales increase being in the mid-single digits on a constant dollar basis, and it also compares to prior guidance of $765 million to $785 million, also in the mid-single digits for total comparable sales on a constant dollar basis.

Lululemon also forecast that its earnings will now be in the range of $0.99 to $1.01 per share. Its prior forecast was $0.96 to $1.01, based upon a 31.2% tax rate.

A few analysts weighed in on Lululemon prior to the release of the earnings report:

  • Wedbush reiterated an Outperform rating with an $81 price target.
  • Jefferies reiterated a Hold rating with a $64 price target.
  • Credit Suisse also has a Hold rating with a $64 price target.
  • MKM Partners reiterated a Buy rating with a $90 price target.
  • Oppenheimer has a Buy rating with a $75 price target.
  • Canaccord Genuity reiterated a Sell rating and lowered its target to $45 from $47.

Excluding Wednesday’s move, Lululemon has underperformed the broad markets with the stock down 2% year to date. Over the past 52 weeks, the stock is down 6%.

Shares of Lululemon were last seen up 1.5% at $64.66 on Wednesday, with a consensus analyst price target of $73.81 and a 52-week trading range of $54.00 to $81.81.