Lululemon (LULU) shares drastically increased Friday after the athletic apparel company surpassed third-quarter earnings projections. This impressive performance has led to an infux of upbeat price targets from notable analysts. Morgan Stanley applauded the result and the company's enhanced full-year forecast, remarking on the stabilized growth in the U.S. and spurring acceleration in the women's and China market spaces. The firm reaffirmed its "overweight" rating, boosting its price target to $414.
Lululemon responded by elevating its year-long revenue expectation to a range of $10.452 billion to $10.487 billion. This optimistic prediction is a rise from the former estimation of $10.375 billion to $10.475 billion.
Analysts at Stifel also viewed the company positively, hoisting their price target from $370 to a substantial $438 and preserving a “buy” rating. This attitude adopts a roughly 7% premium after Lululemon shares catapulted 18% to brush an intraday peak of approximately $408 Friday.
"We perceive LULU to sit uniquely at the juncture of persistent trends and consider its international growth potential to be underestimated," Stifel analysts expressed in a Thursday report. They project the company is primed to “uphold robust growth” through customer expansion and amplified revenue per customer.
This shared confidence amongst analysts transpires after Chief Executive Officer Calvin McDonald previously accepted the company's 'novelty' issue, with a shortage of seasonally refreshed products causing reduced conversion rates.
Towards late Friday afternoon, Lululemon shares were observed up by around 16% at $401.52, although they have fallen over a fifth of their value in 2024.