Lululemon Athletica Inc. (LULU) PT Raised to $380 at Citi

Citi analyst Paul Lejuez raised the price target on Lululemon Athletica Inc. (NASDAQ: LULU) to $380.00 (from $270.00) while maintaining a Neutral rating.

The analyst comments "3Q sales/EPS beat cons based on stronger int’l sales/GM. While Americas comp of -2% was still weak, mgmt is seeing the customer respond to newness/innovation in women’s, pointing to 1Q25 for an expected inflection in the US, as newness builds further. 4Q guidance of $5.56-5.64 is in-line w/cons w/markdowns expected to be down slightly yr/yr (suggesting LULU is not getting more promotional). 4Q guidance seems conservative, as mgmt indicated they were pleased with Black Friday weekend and guidance assumes a ~300bps comp headwind from a shortened holiday calendar (but we did not see evidence of that in 4Q19) and GM pressure from fixed cost deleverage (despite 53rd week benefit). As we look to F25, we are more confident than before that the US will return to growth. However, uncertainty remains and with shares trading (pre-market) at an F25E P/E multiple of 24x, we see a balanced risk/reward."

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