*Lululemon Drops 11%, Americas Revenue Falls: See it Under $100?* š
$LULU just got hit hard after earnings. Down 11% and Americas revenue fell YoY. Now the question: is $100 the next stop, or a fat discount for long-term holders?
*Bear case - Under $100:*
Americas is Luluās core market. When same-store sales + revenue drop there, growth story cracks. Inventory issues, tougher competition from Alo, Vuori, and Nike, plus consumers cutting back on premium athleisure. If US spending keeps slowing, $100 psychological support breaks fast. Analyst downgrades usually follow big misses, adding more selling pressure.
*Bull case - Buy the dip:*
Lulu has survived ābrand is deadā calls before. International growth is still strong, especially China. Gross margins stayed solid, and theyāre buying back shares. $LULU has a cult brand + pricing power most retailers dream of. 11% drop in one day often overshoots fundamentals. If you believed in Lulu at $300, the thesis of high-margin, loyal customers hasnāt changed. Under $100 would put it at ā¼15x earnings - cheap for a brand like this.
Iām not catching a falling knife on day 1. But Iām watching $100 closely. If it holds + management shows a fix for Americas, thatās when I scale in. If it breaks, next support is lower.
Whatās your take? Is Lulu a broken growth story or a premium brand on sale?
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