LuLulemon Athletica (LLL.TO)

Great company but still a little bit expensive for his liking. Handled the “sheer pants” fiasco very, very well. 26X earnings is a little too rich for him.

On the missteps of the company yesterday, he would avoid this stock until there is further evidence they can turn things around and continue their path towards earnings growth as well as top line growth. Fundamentals are very strong. Excellent products, very strong market following and very few competitors.

Adores the product. Lots of room for expansion. Men like it too. Her problem with the stock is that there is no room for a mistake at these multiples. Great company and product but risky because it can’t have a miss-step. Down 10-15% from here would make it attractive.

Kind of scares him to some extent because it is trading at a forward PE of 37X. Have just issued a Q4 revenue guidance at the high end of the prior range. With the high PE, any hiccups they may have, this stock could come down quite quickly. However, the technicals look very, very strong.

This one has confounded him. It has been a growth stock, a wonderful stock. Tried to Short at $18 a couple of years ago but it didn’t work out. Had a fantastic roll out of their stores. Hit a core niche nerve with the athletic market in yoga wear but there are a lot of people upset with the stores and they have a serious issue. Would not want to be in this stock before the quarter. He would be looking to Short, not owning.

Company has done very well at executing their growth strategy in the US. As a value investor, it is difficult for her to buy a stock that is trading at 40X forward earnings, even though their growth outlook is quite strong. Too expensive for her. Canadian market is pretty well tapped out and so now it is the US and are starting to look at international expansion, but that is in the very early stages. In a couple of years they will likely start opening some stores.

It’s a little expensive. A great company. Had amazing growth but the problem is that if there is any problem in sales during Christmas it will take quite a tumble. It is a high priced stock and dependent on the growth rate.

(Top Pick Sep 13/11, Up 30.80%) There are a lot of naysayers. LLL continues to execute and grow their stores. They go into a community and open a show house and host yoga classes and figure out what demand and take-up is.

Over the course of the summer, retailers have had a great run. The momentum seems to be coming out of them in the last week or 2. This one has great same-store sales, great international growth opportunities, great per square foot sales. You have to decide how much economic sensitivity that you want going through this fall.

Very good operator. Trading at 37X forward earnings. Built for perfection. Has always looked too expensive for him so he sees higher risks than rewards.

(A Top Pick Sept 13/11. Up 2.32%.) He was stopped out around $62. He’ll be entering again sometime when a good quarter comes in.

Has always been too expensive for her as she tends to be a value buyer. Very sensitive to earnings so even the slightest slip and the stock will come down. Products are premium priced and there is softness on high-end products.