Cramer Says “I Can’t Give You a Good Reason to Buy Lululemon” After Michael Burry Calls the Company “A Fat Pitch” Below $100
Michael Burry read the 10-Q, the conference call, and the 8-K on Lululemon and came away calling it a generational buying opportunity. Six days later, Jim Cramer looked at the same quarter and told investors to rubberneck and move on.
Two of the market’s most-watched voices took opposite sides on the same quarter, six days apart. On September 4, 2026, StockTwits reported that Michael Burry had published a Substack post calling Lululemon (NASDAQ:LULU | LULU Price Prediction) a fat pitch. On September 10, 2026, Jim Cramer used his Mad Money segment to reach the opposite verdict on the same set of facts.
Burry’s Fat Pitch
A fat pitch is baseball shorthand for a ball down the middle: an at-bat where the reward looks unusually large compared with the risk of swinging. Michael Burry said Lululemon fit that description below $100 and told readers he planned to buy more shares when the market opened.
Burry engaged with the quarter directly. Burry said he read the 10-Q, the conference call transcript and the 8-K and concluded that “clearly things have changed for the worse.” His argument was that the damage is temporary rather than a permanent breakdown of the brand. Burry compared Lululemon’s current position to where Abercrombie & Fitch, Ralph Lauren and Lululemon itself sat in 2017, and said investors get paid for betting against the idea that a strong consumer brand never returns to growth.
Every valuation figure is Burry’s own model output. He said that even after lowering his assumptions for U.S. and China growth, global comps and operating margins, the stock still trades below his estimate of intrinsic value if the brand regains its footing. He pointed to the cash on the balance sheet, the absence of financial debt, and continued share retirement as downside protection. Financials in the quarterly release support that framing: $1.39 billion in cash and equivalents and 2.7 million shares repurchased at an average price of $120 in the quarter (see the company’s Q2 8-K).
Burry identified incoming CEO Heidi O’Neill as the biggest reason to believe in a turnaround. On the setup she inherits, Burry wrote: “Nevertheless, a new CEO is coming in and I smell the stench of a kitchen sink left with no running water for far too long. The new CEO is coming in with the lowest of bars, just as one would expect from a fresh-from-battle Chairwoman who silenced her biggest critic and won the choice of a CEO who could not start for six months just because she could.”
Burry closed by naming his short list: “Right now the only others that are clear super fat pitches in my universe are JD and Alibaba. I own the former but not the latter. I plan to buy Alibaba stock soon.”
Cramer’s Refusal
Cramer opened his segment with the headline verdict: “I can’t give you a good reason to buy Lululemon even after these stunning declines. Other than the kitchen sink thesis and the fact that the stock now appears to have a low price earnings multiple, according to CNBC. See, that’s not good enough though.” The shares carry a trailing PE near 8, which is the multiple he was referring to.
He laid out three causes. On leadership, Cramer said: “Basically, for the last eight months, Lulu’s had no permanent leadership, and that’s caused them to make a series of unforced errors.” On the category, Cramer said the athleisure category remains in the doghouse and the competition is as crowded as ever, slashing price and cutting margins. On China, Cramer pointed to a 2% China same-store sales decline when analysts had been looking for a 14.5% increase, tying the miss to a Great Wall marketing activation.
On the guidance, Lululemon cut its full-year outlook to diluted EPS of $9.48 to $9.73. Cramer warned that “Buying Lululemon because it’s cheap has been a sucker’s game all the way down because they keep cutting numbers.” He refused both sides of the trade: “I think it’s too risky to short this one. But I still can’t be a buyer either.” His close: “For now, let’s just say this stock is bleeding out in no man’s land, according to CNBC. Don’t try to be a hero and buy it. Just try to rubberneck and then move on.”
Same Kitchen Sink, Two Verdicts
Both men independently reached for the same image about the same quarter and the same incoming CEO. For Burry, cleared decks are the reason to buy. Cramer named the “kitchen sink quarter” possibility explicitly, tied it to Heidi O’Neill’s arrival, and then declared it not good enough.
Time Horizon Is the Real Split
They barely disagree on the facts. Both read the quarter as genuinely bad. Both see a new CEO walking into deliberately lowered expectations. What separates them is time horizon and what each is willing to underwrite. Burry is modeling an outcome measured in decades and is content to be early. Cramer is answering what to do with the stock now, and his objection is that a company which keeps cutting its numbers has repeatedly punished people who thought the bottom was in.
Where the Stock Sits Now
As of the September 11, 2026 pre-market session, LULU was quoted at $96.80, down 0.08% from the prior close of $96.88. That leaves the stock below the level Burry named. Over the past week it is down 20.51%, year to date it is down 53.42%, and over five years it is down 77.25%.
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AJ has spent the past 10 years writing about financial markets at The Motley Fool. His coverage centers on technology stocks and the broader macroeconomic trends, from interest rates to geopolitics, that shape where markets are headed next. AJ is drawn to the stories where big-picture economics and individual companies collide.
