Credit Suisse Keeps a Hold Rating on Lululemon

By Carrie Williams

Credit Suisse analyst Christian Buss reiterated a Hold rating on Lululemon (NASDAQ: LULU) on June 1 and set a price target of $56. The company’s shares closed last Friday at $54.29.

Buss wrote:

“We remain cautious on shares given premium valuation for a maturing retailer. That said, lululemon is doing a better than expected job at finding ways to emphasize the company’s highest-margin core business and drive incremental operating profit on more moderate growth targets. The dramatic de-emphasis of the ivivva brand as a growth vehicle looks to be an appropriate move, de-risking the deleveraging of fixed expenses that has become an incremental source of concern as sourcing improvements are likely to become more challenging.”

According to TipRanks.com, Buss is a 3-star analyst with an average return of 1.3% and a 54.5% success rate. Buss covers the Services sector, focusing on stocks such as Abercrombie Fitch, Acushnet Holdings, and Burlington Stores.

Currently, the analyst consensus on Lululemon is Moderate Buy and the average price target is $61.67, representing a 13.6% upside.

In a report issued on May 30, Susquehanna also reiterated a Hold rating on the stock with a $51 price target.

Lululemon’s market cap is currently $7.44B and has a P/E ratio of 24.57. The company has a book value ratio of 5.4724.

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lululemon athletica, inc. designs and retails athletic apparels primarily in North America and Australia. It offers a comprehensive line of apparel and accessories, including fitness pants, shorts, tops and jackets designed for athletic pursuits such as yoga, running and general fitness. The company operates through corporate owned stores and direct to consumer segments. Its yoga-inspired apparel is marketed under the Lululemon Athletica brand name. lululemon athletica was founded by Dennis J. Wilson in 1998 and is headquartered in Vancouver, Canada.