LULU - 10 Reasons To Buy Lululemon
2024-07-16 14:59:17 ET
Summary
- Lululemon Athletica Inc. stock has dropped over 40% in 2024.
- Blame growth slowdown and soft outlook for the selloff.
- Aside from that, Lululemon’s fundamentals remain solid — probably the best that they have ever been.
- Under $300 a share, Lululemon looks like a compelling investment opportunity.
- In this mini deep dive, I highlight 10 reasons why.
Introduction
Lululemon Athletica Inc. ( LULU ) has been on my radar for quite some time now, but I couldn’t fathom buying the stock at $400 or $500 when shares were trading at 40x to 50x its earnings. However, Lululemon stock has sold off more than 40% since the start of 2024, bringing its valuation down to much more reasonable levels.
At less than $300 a share, Lululemon is beginning to look like an attractive long-term investment. Although shares did trade below $300 a little over a year ago, I missed the opportunity to initiate a position as I was busy accumulating shares of its peer, On Holding AG ( ONON ), which, at that time, was trading at a much better risk-to-reward profile than Lululemon. You can read my latest ONON article here .
Fortunately, the markets gave me yet another opportunity to buy Lululemon stock. So, for the last few weeks, I have been studying the company, its fundamentals, and its financials — the byproduct is this mini deep dive.
And after all is said and done, I have compiled 10 solid reasons to buy Lululemon stock under $300 a share....
10 Reasons To Buy Lululemon