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Lululemon ($LULU) Slides After Q2 Earnings; Key Levels to WatchLululemon Athletica Inc. (NASDAQ: NASDAQ:LULU ) experienced a sharp pullback early Friday despite posting better-than-expected earnings in Q2. The activewear giant’s outlook and revenue missed analysts' expectations, fueling investor concern. Fundamental Analysis Lululemon (NASDAQ: NASDAQ:LULU ) reported Q2 earnings of $3.15 per share, a 17.5% increase year-over-year, surpassing the FactSet consensus estimate of $2.93 per share. Revenue rose 7% to $2.37 billion but fell short of the expected $2.4 billion. Despite the earnings beat, Lululemon’s revenue growth has slowed over the past two quarters, raising concerns about the company's ability to maintain its momentum amid rising competition and shifting consumer behavior. Q3 and Full-Year Guidance: A Mixed Bag For Q3, Lululemon (NASDAQ: NASDAQ:LULU ) guided revenue to be in the range of $2.34 billion to $2.365 billion, representing a 6% to 7% growth rate, with earnings projected between $2.68 and $2.73 per share. This was slightly below analysts' expectations of $2.70 per share on $2.4 billion in sales. Lululemon’s full-year sales guidance of $10.38 billion to $10.48 billion also missed the market consensus of $10.6 billion, while the earnings outlook of $13.95 to $14.15 per share was aligned with estimates of $14.01 per share. Key Concerns: Slowing Growth and Competitive Landscape Earnings and revenue growth have decelerated, reflecting broader market trends such as weakened consumer spending amid inflationary pressures. Comparable store sales increased by 2%, below the anticipated 5.9%. The company also faces rising competition from other athletic apparel brands and general retail slowdowns, impacting sales growth. Additionally, Lululemon’s missteps, such as the troubled launch of its Breezethrough leggings, have weighed on investor sentiment. Technical Analysis Lululemon’s stock has been on a steep decline, dropping nearly 49% year-to-date. However, shares showed signs of breaking this downtrend in premarket trade on Friday, climbing 4.6% to retest key technical levels. Descending Channel and Moving Averages Since gapping below the 200-day moving average (MA) in late March, Lululemon (NASDAQ: NASDAQ:LULU ) has traded within a descending channel, marking a persistent multi-month downtrend. In recent weeks, the stock attempted a breakout but faced resistance near the channel’s top trendline and the 50-day MA. Premarket trading indicates a potential retest of these areas, setting up a pivotal moment for the stock. Key Technical Levels to Watch 1. $272 Resistance: This level coincides with the descending channel’s top trendline and the downward-sloping 50-day MA. A decisive move above this could signal a breakout, prompting further buying interest. 2. $293 Target: The next significant resistance lies around $293, close to the 23.6% Fibonacci retracement level from the December high to the August low. This level also aligns with key lows in May and July, suggesting potential selling pressure. 3. $335 Region: Should momentum carry Lululemon higher, the $335 level near the 38.2% Fibonacci retracement could be the next target. This area could see resistance from notable swing highs and lows in April and June. 4. $371 Long-Term Target: A sustained uptrend could see the stock approach the 50% Fibonacci retracement level at $371, where profit-taking might occur. This level aligns with April’s countertrend peak, situated near the descending channel’s upper boundary. Conclusion Lululemon faces a challenging road ahead as it seeks to regain investor confidence amid slowing growth and competitive pressures. While the company’s earnings beat expectations, its cautious outlook and revenue shortfall highlight broader industry challenges. On the technical front, key levels could determine the stock’s next move, with a potential breakout above $272 setting the stage for a more extended rally. Investors should closely monitor these technical markers alongside Lululemon’s ongoing strategic initiatives and broader economic trends to gauge the stock’s recovery prospects.
NASDAQ:LULUShort
by DEXWireNews
Lululemon: Downward Dog Days Ahead? - A Wyckoff Distr AnalysisINTRO I have been sitting on this idea for a while and finally decided to put the pen to the pad. For the past three years, there have been signs that Lululemon's stock may be destined for a decline. This trade idea will explore the potential for a downtrend using Wyckoff analysis, a technical analysis pattern used to identify trends within a market cycle. The Wyckoff Distribution theory suggests that large institutions subtly distribute their holdings and initiate short positions before a significant price decline. This distribution unfolds in five distinct phases, each with its own characteristics. In this article, I'll describe these phases and analyze how they might be seen in Lululemon's case. For reference, this is the schematic I will be comparing my LULU case to. The Setup The company's story began in 2008 with its founding. Like most companies, it was affected by the 2008 financial crisis and faced challenges in its performance. However, it recovered strongly over the next 3 years, with its stock price increasing by almost 3,700% from its low in 2009 to its high in 2012. From 2012 to 2018, the stock underperformed as its valuation took some time to catch up. During this period, LULU steadily improved its financial performance, attracting the attention of smart investors who began accumulating shares. Phase A The distribution phase marks the end of the prior uptrend. Up to this point, buyers have been dominant, but now we see evidence of institutional selling with the preliminary supply (PSY) and the buying climax (BC). The BC indicates the end of the uptrend as institutions freely unload shares. The low created after the BC is called the automatic reaction (AR). This low is important because it represents the lowest price at which institutions are willing to sell their shares. The AR and BC form our distribution channel, and there will be secondary tests (ST) of these ranges. Phase B Phase B functions to create momentum in preparation for a new downtrend. During this phase, institutions and large professional interests sell off their holdings and start taking short positions. This is typically marked by low-volume rallies and high-volume declines. Additionally, we may witness signs of weakness (SOW) and upthrusts (UT), which are further tests of supply and demand as institutions assess interest. Note the volume as the stock price advances and declines. Phase C Phase C is an optional phase that primarily serves as a test of the remaining demand. You can identify it by the UpThrust After Distribution (UTAD), which is a price move above the trading channel resistance that quickly reverses and closes back within the channel. It is a bull trap – it appears to signal the resumption of the uptrend but in reality, it is intended to trick uninformed break-out traders. It is used to snag additional shares short at elevated prices before a decline. Note the volume spike to create the UTAD and the volume spike to take it away. Phase D In Phase D, there is growing evidence that the uptrend is coming to an end. Sellers take control, leading to a clear break of support or a decline below the midpoint of the trading channel after a UT or UTAD. During this phase, there are typically several weak rallies, each marked by the last point of supply (LPSY). Phase E The final phase of the cycle is Phase E. It depicts the unfolding of the downtrend; the stock leaves the channel to the downside and supply is in control. This represents a high-probability opportunity to sell short. Subsequent rallies during the newly formed downtrend are quickly washed with selling. We haven't entered Phase E yet, but the chart is currently aligning well with our expectations. Given that the pattern has taken 3 years to form, it will likely result in a longer-term short. I believe that targeting the 150s is reasonable if the analysis is accurate. I would appreciate hearing your thoughts on this.
NASDAQ:LULUShort
by Decam9
9
$LULU counter trend rally?I've seen a lot of chatter on Twitter lately about NASDAQ:LULU since it's now 40% off the highs from the beginning of the year... this led me to look at the chart, and to me it's looking pretty bottomed out in the short term. As you can see on the chart, we've largely been ranging in a large channel since 2021. It would make sense to me that we'd see one more counter trend rally here (3rd touch on support) up to $384-$465 or so (around 40%-70% move higher). Note: There's also a possibility of a wick down to the support at $273. This might make a better entry. Losing that support level would invalidate the idea. I think this move is likely to play out sometime over the next 2 or so months (if that support holds). Let's see if it plays out.
NASDAQ:LULULong
by benjihyam
Lululemon: Still Sweating It Out in the Athleisure Arena?Lululemon: Still Sweating It Out in the Athleisure Arena? Lululemon, once the undisputed queen of the yoga pant kingdom, is facing a new reality in the ever-evolving world of athleisure. While the brand still boasts a loyal fanbase and undeniable brand recognition, questions linger about its ability to maintain relevance against a growing legion of competitors. The Rise and Reign of Lululemon Lululemon's story is one of meteoric ascent. Founded in 1998, the company carved a niche for itself by prioritizing quality and functionality in yoga apparel. Their signature Luon fabric, known for its breathability and sweat-wicking properties, became a game-changer. Lululemon cultivated a community around its stores, fostering a sense of belonging and exclusivity. Their high price points weren't just tolerated, they were seen as a badge of quality. The Changing Landscape of Athleisure However, the landscape has dramatically shifted. Athleisure is no longer confined to yoga studios. It's a mainstream fashion choice, embraced for everything from workouts to errands. This has opened the door for a flood of competitors offering similar – and sometimes more affordable – options. Competition Heats Up Mainstream brands like Nike and Adidas have aggressively expanded their athleisure offerings. Fast-fashion retailers like H&M and Zara are churning out trendy athleisure pieces at a fraction of the price. Upstart brands with innovative materials and designs are also vying for market share. Lululemon is no longer the only game in town. Beyond the ABC Pants Lululemon's reliance on its core products, like the ubiquitous Align leggings and ABC (Anything But Compression) pants, might be holding them back. While these remain popular, they haven't kept pace with the evolving trends. Consumers are looking for a wider variety, from high-performance workout gear to stylish athleisure pieces that seamlessly transition from gym to brunch. The Scrunchie Factor Lululemon's recent forays into accessories like belt bags and hair scrunchies raise questions about their brand direction. While these might generate some additional sales, they risk diluting the brand's core identity as a leader in performance apparel. Staying Relevant: A Path Forward So, has Lululemon lost its relevance? Not necessarily. But they face an uphill battle. Here are some ways they can stay competitive: • Embrace Innovation: Lululemon needs to continue innovating, developing new fabrics and designs that cater to the diverse needs of today's athleisure consumer. • Expand the Product Range: Offering a wider variety of styles and price points can attract a broader customer base. This doesn't have to compromise their core focus on quality, but it does require strategic expansion. • Cater to Different Activities: Lululemon can move beyond the yoga studio and cater to a wider range of athletic pursuits, offering specialized apparel for running, training, and other fitness activities. • Focus on Community: Lululemon's community focus has always been a strength. They can leverage this by creating engaging in-store experiences, hosting workshops, and building a stronger online community. • Sustainability Matters: Consumers are increasingly concerned about sustainability. Lululemon can solidify its position by prioritizing eco-friendly practices throughout their supply chain. Lululemon's legacy in the athleisure industry is undeniable. But their future success hinges on their ability to adapt, innovate, and cater to the market's ever-changing needs. The days of dominance built solely on high-priced yoga pants are likely over. The road ahead requires a focus on product diversification, strategic expansion, and a renewed commitment to staying at the forefront of the athleisure revolution.
NASDAQ:LULUShort
by bryandowningqln
Analyzing NVDA's Breakout Patterns and Strategic Trading InsightDuring the last breakout, NVIDIA (NVDA) surged by 300 points before experiencing a sharp decline of 134 points within two days. This current situation bears a striking resemblance to the previous occurrence. Reaching 1282 would position NVDA as the most valuable company globally, contingent upon Microsoft's valuation. I possess additional market capitalization levels for comparison with Microsoft. I anticipate NVDA's final ascent towards becoming the world's most valuable company, followed by a significant pullback. This scenario echoes Tesla's (TSLA) behavior when it announced its first stock split: a substantial run-up leading into the split date, followed by a rapid 30%+ decline over a few days. Currently, I hold long call options for the upcoming day. I purchased 1200C on Monday, sold the majority, and retained one position overnight. My plan is to transition to put options when NVDA reaches the 1282-1300 level. Trade Idea: 1200P 6/14 at 1282.
NASDAQ:NVDA
by KevinBurrows
1
LULU: Luxury Powerhouse & Multi-Decade TrendsetterKey Rationale: Fundamentals remain intact making this a very attractive time to be contrarian, ignore the pessimism and buy the dip. Always nice to buy what you know and can see around you. Comments: Credited with the development of athleisure. Hasn't yet seized Pickleball market opportunity. Incessant selling due is unwarranted with one executive departing. One of the best available Ex-U.S. stocks. Potential tailwind off the back of Ozempic & GLP-1 craze. Still a profitability powerhouse with pricing power because of its iconic brand. Same-store sales are growing exponentially, and an expansionary opportunity abroad. Narrow Moat, Exemplary Capital Allocation. Luxury market is different from discount competitors, and luxury brands are seldom cheap. 3-Star Valuation on Morningstar, hasn't been this cheap since 2017. Stellar Profitability, Growth, and Quality scores in GreenBlue (4, 29, and 125 out of 2982) Proprietary Scores: GreenBlue Cumulative Rank: 128/2982 (Lower = Better) GreenBlue Current Rank: 407/2982 (Lower = Better) GreenRed Rank: 225/499 (Lower = Better) Gurufocus Score: 97/100 (Higher = Better) Company Profile: Lululemon Athletica designs, distributes, and markets athletic apparel, footwear, and accessories for women, men, and girls. Lululemon offers pants, shorts, tops, and jackets for both leisure and athletic activities such as yoga and running. The company also sells fitness accessories, such as bags, yoga mats, and equipment. Lululemon sells its products through more than 700 company-owned stores in about 20 countries, e-commerce, outlets, and wholesale accounts. The company was founded in 1998 and is based in Vancouver, Canada. Competitors: ROST, TJX, BURL, GPS, URBN Risks: This goes the path of Nike and is dead money for the near future.
NASDAQ:LULULong
by RHTrading
Lululemon Stock Sinks 6.38% As Chief Product Officer ResignsLululemon Athletica ( NASDAQ:LULU ) has announced an organizational restructuring, with Chief Product Officer Sun Choe resigning to pursue another opportunity. The company stated that the changes are designed to support the company's growth plans, accelerate product innovation, and enable its go-to-market strategies. Lululemon ( NASDAQ:LULU ) will not replace the CPO position. Global Creative Director Jonathan Cheung will drive the product design and innovation roadmap, while continuing to oversee design, innovation, and product development at the firm. Several analysts have argued that the move is a bad sign for the company, as Lululemon ( NASDAQ:LULU ) faces a slowing apparel market and tough competition. Lululemon shares ( NASDAQ:LULU ) were down about 7% to $299.95 as of 10:21 a.m. ET Wednesday. The stock was down 4.4% premarket Wednesday after the company announced the departure of its chief product officer and said it would overhaul its product and brand teams. Lululemon ( NASDAQ:LULU ) will now have Jonathan Cheung, global creative director, report directly to Chief Executive Calvin McDonald and oversee product design and innovation. Cheung has more than 30 years of experience in senior leadership roles at global brands. Lululemon will also create a new team of leaders from merchandising and brand functions to manage global and regional go-to-market strategies. Nikki Neuburger will become chief brand and product activation manager to oversee merchandising, footwear, and product operations on top of her current responsibilities. Elizabeth Binder, chief merchandising officer, will report to Neuburger. Wedbush analyst Tom Nikic believes the selloff seems overdone and is likely due to how well-liked and well-respected Choe was by Wall Street. Lululemon ( NASDAQ:LULU ) has been a "notable laggard" in Wedbush's coverage this year, with the stock down 37% and the S&P 500 SPX having gained 12%. Choe's reign saw Lululemon's revenue grow by about 4%. Technical Outlook Lulu Lemon ( NASDAQ:LULU ) stock is down 6.47% as of the time of writing trading with a Relative Strength Index (RSI) of 20.47 which is oversold. The stock has been on a falling wedge pattern for over 8 weeks now.
NASDAQ:LULU
by DEXWireNews
Lululemon ($LULU) Set to Lay-off 128 EmployeesLululemon Athletica ( NASDAQ:LULU ), the Vancouver-based apparel retailer, has announced the closure of its distribution center in Washington state by the end of the year, resulting in the layoff of over 100 employees. The company cited business optimization efforts as the reason behind the closure. According to a WARN notice filed with the state's Employment Security Department, the Sumner distribution center will be shuttered, and 128 jobs will be cut beginning June 21. The move comes as Lululemon ( NASDAQ:LULU ) experiences slowing demand for its premium athleisure in North America, which has resulted in lower orders for sportswear and apparel firms due to excessive inventory levels at sporting retailers. Lululemon ( NASDAQ:LULU ) has stated that some of the employees affected by the closure will be retained and relocated to other facilities, including the recently opened distribution center in the greater Los Angeles area. The retailer had entered into a new lease for an approximately 1.26 million-square-foot distribution center in Ontario city in California in 2021, which will expire in 2039, according to its annual filing. Lululemon ( NASDAQ:LULU ) also owns a distribution center in Groveport, Ohio, while leasing the majority of its other facilities located across the United States, Canada, and Australia. The company's shares have dropped more than 31% so far this year.
NASDAQ:LULULong
by DEXWireNews
Lululemon ($LULU) Plunges 18% on Disappointing OutlookLululemon Athletica Inc. ( NASDAQ:LULU ) encountered a tumultuous Morning trading trading session on Friday, with shares plunging 18.47% following the company's release of guidance that failed to meet analysts' expectations. Amidst challenges in its Americas business and a notable shift in U.S. consumer behavior, the Vancouver-based activewear retailer painted a cautious picture for the upcoming quarter and full year. Lululemon ( NASDAQ:LULU ), a prominent name in the activewear industry, experienced a stark decline in its stock price on Friday, as investors grappled with the company's subdued outlook for the near future. Despite reporting impressive earnings and revenue figures for the holiday quarter ending January 28, Lululemon's forward guidance fell short of Wall Street's estimates, triggering a sharp sell-off. CEO Calvin McDonald acknowledged the evolving dynamics in the U.S. consumer landscape during the company's earnings call, attributing the slower start to the year to shifting consumer preferences and constraints in sizing and color options. While international sales, particularly in China, displayed robust growth, concerns lingered over stagnating sales in the Americas region, signaling potential challenges ahead. Analysts had anticipated stronger revenue and earnings projections for both the current quarter and full year, but Lululemon's guidance painted a more conservative picture, citing uncertainties in consumer behavior and market conditions. The company's outlook, which forecasts modest top-line growth and diluted EPS figures below consensus estimates, raised apprehensions among investors about the sustainability of its growth trajectory. Technical Outlook Lululemon ( NASDAQ:LULU ) stock is currently trading below its Moving Averages indicating selling pressure on the ticker, further ascertaining to the thesis, is the weak Relative Strength Index (RSI) of 26 indicating the bears are pushing the share price lower.
NASDAQ:LULU
by DEXWireNews
LULU Lululemon Athletica Options Ahead of EarningsIf you haven`t bought LULU before the previous earnings: Then analyzing the options chain and the chart patterns of LULU Lululemon Athletica prior to the earnings report this week, I would consider purchasing the 470usd strike price Calls with an expiration date of 2024-7-19, for a premium of approximately $39.50. If these options prove to be profitable prior to the earnings release, I would sell at least half of them.
NASDAQ:LULULong
by TopgOptions
1
Lululemon's Strong Holiday Season Signals Power Move in Retail Lululemon Athletica Inc. emerges as a standout player in the retail game, defying earlier cautious sentiments and setting a tone of confidence. The sportswear giant recently revised its fourth-quarter sales and profit forecasts, surprising both investors and industry observers alike. In a move that reflects resilience amidst economic challenges, Lululemon has not only weathered the storm but is flourishing, offering a compelling narrative for potential buyers. 1. Festive Boost Exceeds Expectations: Lululemon's decision to raise its fourth-quarter sales outlook comes on the heels of a holiday season that surpassed initial projections. Contrary to earlier concerns about consumer restraint due to inflation and interest rates, the company experienced robust demand, driven by enticing discounts and strategic deals. CFO Meghan Frank's statement underlines the success of Lululemon's balanced sales trends across channels, categories, and geographies. 2. Strategic Forecast Adjustments: The upward revision in revenue guidance, now ranging between $3.170 billion and $3.190 billion, showcases Lululemon's confidence in its sustained performance. The revised profit-per-share projections of $4.96 to $5.00, up from the previous range, hint at the brand's financial strength and ability to navigate challenges effectively. 3. Online Sales Surge and Margin Boost: The rise of online sales, aided by discounts and "buy now, pay later" plans, played a pivotal role in Lululemon's success. Despite a highly promotional retail environment, the company reports that shoppers are making purchases at full price, contributing to impressive gross margins. This defies the common narrative of heavy discounts eroding profitability. Conclusion: Lululemon's recent performance not only defies industry expectations but also signals a bullish outlook for the sportswear market. The company's ability to adapt to the evolving retail landscape, capitalize on online trends, and maintain strong margins paints a compelling picture for potential investors.
NASDAQ:LULU
by DEXWireNews