Lululemon Shares Drop 4.5% Following Supreme Court Tariff Ruling Delay
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 12h ago
0mins
Source: Fool
- Tariff Impact: Lululemon's shares fell 4.5% following the Supreme Court's delay in ruling on tariffs, reflecting investor concerns about the company's future profitability, particularly with a potential cost impact of $240 million in fiscal 2026.
- Management Turmoil: The pressure from tariffs has led to the ousting of CEO Calvin McDonald, creating instability that could hinder strategic execution and market confidence, especially with founder Chip Wilson pushing for a proxy battle.
- Poor Market Performance: Lululemon was one of the worst-performing stocks in the S&P 500 last year, primarily due to stagnating sales in its core North American market and headwinds in discretionary spending, posing greater growth challenges for the company.
- Valuation Appeal: Despite these challenges, Lululemon's current price-to-earnings ratio of just 14 may attract value investors if the company can return to growth, particularly at its current price levels.
Analyst Views on LULU
Wall Street analysts forecast LULU stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for LULU is 193.95 USD with a low forecast of 120.00 USD and a high forecast of 350.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
25 Analyst Rating
2 Buy
22 Hold
1 Sell
Hold
Current: 212.170
Low
120.00
Averages
193.95
High
350.00
Current: 212.170
Low
120.00
Averages
193.95
High
350.00
About LULU
lululemon athletica inc. is a technical athletic apparel, footwear, and accessories company. The Company organizes its operations into four regional markets: the Americas, China Mainland, Asia Pacific (APAC), and Europe and the Middle East (EMEA). It conducts its business through a number of different channels in each market, including the Company-operated stores, e-commerce, temporary locations, wholesale, outlets, a re-commerce program, and license and supply arrangements. The Company offers a comprehensive line of technical athletic apparel, footwear, and accessories marketed under the lululemon brand. Its apparel assortment includes items such as shorts, tops, and jackets designed for a healthy lifestyle, including athletic activities such as yoga, running, training, and most other activities. It also offers apparel designed for being on the move and fitness-inspired accessories. It operates stores in the United States, Canada, China Mainland, Australia, South Korea and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
