What Do Organizations And Media Think Of Lululemon As The World'S Third Largest Sportswear Brand?

Lulu Lemon shares fell 2.95% to 255.90 US dollars, with a turnover of 409 million US dollars. As of press release, Lulu Lemon fell 0.15% after the session.

Lulu Lemon plans to release its next quarterly earnings announcement on Wednesday, March 25, 2020. Lulu Lemon updated its fourth quarter earnings guidance on Monday, January 13. The company provided EPS guidance for the period from $2.22 to $2.25, while Thomson Reuters' consensus EPS estimate is $2.15. The company issued a revenue guidance of $137.138 billion, while the market generally expected $1.35 billion.

On the evening of February 19, Lululemon released a notice of store opening hours through the official WeChat official account, announcing that several stores in ten cities, including Beijing, Shanghai, Nanjing, Xiamen, and Suzhou, were reopened, including five stores in Beijing. The current Lulu lemon is still worth holding. Let's take a look at the current views of mainstream organizations and media on Lulu lemon.

1. What does the organization think?

Cowen&Co.: Lulu Lemon was rated as "outperforming the market", and its target price was raised to $250

American analyst Cowen&Co. recently pointed out that Lululemon, the sports brand in recent years, is starting to look more and more like Nike. On Tuesday, the company raised its target price of the stock to $250.

The company said that Nike's valuation provides a map for Lulu Lemon's future. When Nike's (increase) multiple is applied to Lulu Lemon's financial indicators and growth opportunities, we will find that the latter has a path to a valuation of $40 billion, a share price of more than $300 and an annual free cash flow of $1 billion.

"Assuming Lulu Lemon can maintain Nike style free cash flow multiples, we believe that it will have a path to a market value of $40 billion. We believe that Lulu Lemon's growth, durability and return on capital characteristics are most similar to Nike's." Cowen&Co. analysts led by John Kernan wrote in a report sent to customers on Tuesday.

Cowen&Co. currently gives Lulu Lemon a "outperform" rating, which means that the stock will rise by about 11% from the current trading price based on the target stock price of $250.

Cowen&Co. said the company's growing menswear and international divisions will drive sales, while pointing out that its consumers are "highly loyal to brand owners". In addition, Lululiang's newly launched Lab series inspired by street style should also attract new customers, and the new footwear series represents that the brand will have more opportunities for expansion.

　　 Piper Jaffray: gave IBD 50 stock overweight rating for the first time, with a target price of $227

Piper Jaffray analyst Erinn Murphy gave IBD 50 an overweight rating for the first time, with a target price of $227. She believes that IBD 50 can surpass its elasticity and will successfully enter new markets.

She said in a research report: "We believe that the brand is a share grower and has more and more opportunities in men's and international markets." "Although the stock price has reached the highest level in 52 weeks, we believe that men's performance in China is better than expected (today there are 28 stores, a total of 460 stores) The success of the recently launched self-care service and the adoption of the loyalty plan may be the catalyst for the upward trend. "

　　 American Stock Research Agency: The stock price performance is eye-catching, and Lululemon enters the footwear market

Last year, Lululemon's share price performance was very impressive, with a market value of more than 30 billion dollars. Although there is a big gap with Nike and Adidas, it has become the third place in the field of sports shoes and clothing. The performance of Lululemon's financial report is indispensable for the stock price to achieve such a good performance.

Expand more product lines and tap more new incremental space. For Lululemon, the product lines it covers are not as rich as those of Nike and Adidas. Further expansion of more product lines in the future will help it gain more revenue growth from its user base. In April 2019, Calvin McDonald, CEO of Lululemon, announced the latest five-year growth plan and said Lululemon would enter the footwear market. How to establish brand characteristics in the new product line is also the focus of Lululemon's consideration in the future.

At present, Lululemon's market value is still a long way from Nike and Adidas, and there is still a long way to go. However, this is Lululemon's highlight in terms of revenue growth. How to maintain a very stable growth in the future is still an important chip to attract investors' trust.

　　 Wells Fargo Bank: upgraded Lulu Lemon to "outperform the market", with a target price of $200

Wells Fargo upgraded Lululemon's stock rating from "level with the market" to "outperform the market", and raised its target price from $144 to $200, a 27% increase. Analyst Ike Boruchow said that with the improvement of the supply chain and the expansion of online channels, the company is expected to continue to outperform the market in the short and medium term.

Global expansion, online business and male products have become the main contributors to Lululemon's growth. In addition, Calvin McDonald, a former executive of Sephora, a global cosmetics retailer, became the new global CEO on August 20, which also made the market place high hopes on him. According to a report of UBS, based on the expectation of Lululemon's market share growth and profit increase, its four strategies, including innovating product lines, strengthening North American store business, expanding online business and expanding international business, will keep the company growing well, and it is expected that its profits will keep growing in five years.

Zacks: Lulu Lemon is rated as "strongly recommended to buy". With the development of e-commerce markets at home and abroad, it is expected that the company will have more room for expansion. Zacks, the US financial media, believes that the company's strategy of achieving revenue of US $4 billion and doubling revenue in 2020 is being implemented in an orderly manner, and has also given the company's highest stock rating of "strongly recommended to buy".

2. What do the media think?

Goblin Capital: How does Lululemon become outstanding in niche industries?

Unlike traditional sporting goods companies, which mainly rely on advertising and celebrity endorsers for brand marketing, Lululemon almost never advertises. It is the ancestor of community marketing.

Lululemon's growth largely depends on the combination of yoga culture and yoga community. Through various community activities that are passed down by word of mouth, Lululemon creates common memories with consumers, deeply binds consumers' minds, and improves consumer loyalty, which is the basis of brand premium.

Accurate positioning+unique marketing+strong innovative design capability are the three major factors for Lululemon's success. The market pricing capability is the core competitiveness derived from the follow-up, which is highly similar to Moutai's pricing power in the liquor industry.

The main risk of Lulu also comes from its product positioning, which can be summarized as "too narrow", and is embodied in four aspects: A, basically limit the category of yoga, B、 Most of them are female customers, and it is difficult to develop male customers, C、 Positioning young white-collar groups, D、 Super high price. Lulu management is also aware of that, except that CD does not consider touch temporarily due to the need of high-end product positioning, it has carried out certain countermeasures for AB.

Lululemon is one of the most successful sporting goods companies in the world in the past decade. Thanks to the early precise market segmentation and the vigorous development of yoga industry, Lululemon has been able to take the lead in yoga, a niche field, and has built a yoga product empire by virtue of excellent products integrating "sports" and "fashion" elements, and the world's top community marketing ability. Lululemon has become a well deserved leader in the industry. Its product quality and brand strength are unmatched in the North American market, and is rapidly moving towards emerging markets such as Europe and Asia, The internationalization process is in full swing. The expansion of male customer groups has achieved remarkable results, and other sports products are also being tried. Financial data and business data are among the best in the whole industry. With Lululemon's current management, design and marketing experience in the yoga field, and with the broad development space of the yoga market, Lululemon still has great prospects.

　　 Sports business: Lulu Lemon, with an annual revenue of 3.3 billion US dollars, signed a male spokesperson and entered the sports shoes market

As some investors are worried, although Lulu Lemon currently has strong capital and strength, both the professional sports track and the sports leisure market have been saturated to a certain extent, even a "sea of blood". It is not easy for Lulu Lemon to overtake on the curve after catching up with the "evening".

In terms of brand awareness, Lulu Lemon still has a lot of "homework" to make up. According to Bernstein's data, Lulu Lemon's brand awareness is still lower than that of its main competitors. In the 1000 person survey conducted by the company, about half of the American respondents have never heard of Lulu lemon. For those whose family income exceeds 75000 dollars, the result is about one fourth.

In terms of channels, Lulu Lemon also needs to increase efforts. At present, Lulu Lemon is only distributed through e-commerce channels and more than 440 stores. Although the brand has been deployed in Asia and other overseas regions, the number is not large. According to the new five-year plan, whether online or offline, the overseas market will be the focus of Lulu Lemon's efforts in the future.

In the field of sports shoes, Lululiang didn't describe what kind of shoes they would make, but the brand said that it found a market gap, which can't help but make people look forward to it. Will Lululiang, which has emerged from the field of minority sports, shake the original sports shoes market?

36 krypton: how does lululemon become the third largest sportswear retail market in the world?

In recent years, the retail market as a whole has been depressed, but there are exceptions. Thanks to the global fitness trend - you may be one of the participants - the growth of sportswear is quite good. But the fastest growing and most eye-catching one is not Adidas with a market value of $140.2 billion or Nike with a market value of $55.1 billion. It's lululemon. This brand of yoga clothing products that women are familiar with has grown rapidly since 2018. Although there is still a gap with Nike and Adidas, it has become the third in the field of sports shoes and clothing. Its market value has exceeded that of the professional sports brand Under Armour, up to US $27.1 billion.

In Q2 this year, Lululemon delivered a 21% rapid growth (North American market), which is also far more than Nike and Adidas. Lululemon's growth in the international market is also strong. The European market has achieved a high growth of 35%, and the Asia Pacific region has also reached 33%, mainly thanks to the strong impetus of 68% of the Chinese market. Lululemon will expand in China in the next step.

However, if it is only positioned in the high-end niche market, it cannot become the third largest sportswear company in the world by market value. What is more worth discussing is why lululemon can grow up from the cracks in the sportswear market controlled by the two giants (Nike and Adidas).

In addition, after being listed on NASDAQ in 2007, lululemon was not always smooth. For a time, because of the management's "discrimination against women" improper remarks, product quality and design problems, it led to a large-scale recall, and its market value shrank seriously, even on the verge of bankruptcy. However, by 2018, Lululemon has grown at a faster rate than its peers, creating an investment myth of ten times (1100%) in ten years. Since the beginning of 2018, Lululemon has increased by 160%.