Michael Hakes - CFA, MBA LuLulemon Athletica (US) LULU-Q WATCH Aug 02, 2024

Shares soared 16% today after reporting. China was a key driver. Inventories and loyalty program are doing well. An excellent quarter. They bought back a lot of shares.

 It reports Thursday. Many short-sellers are betting they won't sell enough because of their high prices, but this is a remarkable company.

At 17x PE, this is frantically trying to bottom. You can put a small position on this now.

It peaked in 2023 and got clobbered last year. Then, it got hit with tariffs and shares sank again. Is -25% since last January. It reports next week. Last March's report was actually okay, beating sales and earnings. But we expected that because the company pre-announced results. That's why the street punished it for weak guidance. He remains hopeful, because he expects the 46% tariff on Vietnam, which makes a lot of LULU product, will face a much lower tariff. However, shares have rebounded 18% the past month. They have a strategic plan focused on product innovation, guest experience and market expansion. Expectations are low for this quarter with even some analysts expecting an upside surprise in earnings and same-store US sales. He likes this set up and would buy now.

It reports Thursday. Are doing a ton of  business in China. Shares are too cheap now.

Is very surprised shares tanked after reporting (he had recommended buying before the report). They had a bad conference call and quarter. Everything went wrong for them, including tariffs. He expects a corporate shake-up.

It was very sold off so she bought it and sold in December for a 36 to 37% return and not a long hold time. It is now oversold even with the recent guidance cut. She doesn't like the discretionary space but there could be some upside.