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Lululemon’s 66% Slide Leaves Shares Trading Below 12x Earnings

An investing column contends the debt‑free retailer’s strong margins support a case for a rerating.

Overview

  • Shares are down about 66% from the December 2023 peak of $516.39, according to the analysis.
  • The stock trades at under 12 times trailing 12‑month earnings, which the piece says is less than half the S&P 500’s multiple.
  • Profitability remains high, with a 58.5% gross margin in fiscal Q2 ended Aug. 3, and the company reports no debt.
  • Over the past six years, revenue and net income have risen 183% and 197%, respectively, highlighting substantial growth since before the pandemic.
  • The article notes revenue growth has slowed and sentiment is bearish, while arguing a valuation rerating could present significant upside over time.