#7 - Lululemon (NASDAQ:LULU)
Lululemon Athletica Inc. (NASDAQ: LULU) has been experiencing strong volatility in the last two years. The first pullback in late 2021 came after consumers transitioned from buying stuff to buying experiences. This latest pullback, which started at the beginning of 2024, is more concerning. Yes, the consumer is weakening, but the company is also facing more competition from companies that some believe are more innovative than the Lululemon brand.
The company is still posting year-over-year growth on the top and bottom lines. However, that growth is slowing significantly, which may have investors questioning whether this is a solid entry point.
The answer may come from analysts’ forecasts. While recent price targets are moving lower, the consensus target of $354.94 is still a 44% increase from the current price. With interest rate cuts expected before the all-important holiday season, it may be an interesting time to get into LULU stock.
About Lululemon Athletica
Lululemon Athletica Inc, together with its subsidiaries, designs, distributes, and retails athletic apparel, footwear, and accessories under the lululemon brand for women and men. It offers pants, shorts, tops, and jackets for healthy lifestyle, such as yoga, running, training, and other activities. It also provides fitness-inspired accessories.
Read More - Current Price
- $379.40
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 18 Buy Ratings, 10 Hold Ratings, 2 Sell Ratings.
- Consensus Price Target
- $377.63 (0.5% Downside)
One benefit of investing in consumer discretionary stocks is that you have many options. This wide-ranging sector includes companies in industries such as retail, automotive, durable goods, and travel.
These are also referred to as cyclical stocks. That means they tend to move up and down in tandem with the economy. And the strongest gains typically come when the economy reverses course.
If owning individual stocks isn't your thing, there are many mutual funds and exchange-traded funds (ETFs) that focus on consumer discretionary stocks. One of the most popular choices is the Consumer Discretionary Select Sector SPDR Fund (NYSEARCA: XLY). In fact, that fund includes five of the stocks mentioned in this presentation.
MarketBeat provides a range of tools to help you find and track stocks of interest in any sector. One of these tools is our stock lists in which you can find a list of the 50 largest consumer discretionary stocks at any given moment.
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