Why Lululemon Stock Popped Today

• Lululemon Athletica bushed connected income and bushed connected net past night.

• Sales maturation was each overseas, however, and profits declined twelvemonth implicit year.

• 10 stocks we similar amended than Lululemon Athletica Inc. ›

Lululemon Athletica (NASDAQ: LULU) banal soared 8.8% done 11 a.m. ET Friday aft crushing connected net past night.

Analysts forecast Lululemon would gain $2.21 per stock connected little than $2.5 cardinal successful income successful Q3, but the institution reported $2.59 per stock connected astir $2.6 cardinal successful sales.

Lulu grew income 7% successful Q3, contempt lone a 1% summation successful same-store sales. Literally each the maturation was international, arsenic "Americas" gross declined 2% but planetary income grew 33%.

Although Lulu bushed the forecasts of Wall Street analysts, its net per stock declined 10% twelvemonth implicit year, suggesting the income Lulu makes internationally whitethorn not beryllium arsenic profitable arsenic those made successful its location market.

Little wonder, then, that CEO Calvin McDonald says "our teams remained focused connected driving improvements wrong our U.S. business," adjacent arsenic it continues to grow internationally.

Looking up to Q4, Lulu warns income volition astir apt diminution 2%, with net betwixt $4.66 and $4.76. Taken astatine the midpoint, this forecast is weaker than Wall Street's forecast -- astir $4.93 per stock successful nett connected income adjacent to $3.6 billion.

For the afloat year, Lulu expects income of $11 billion, and net betwixt $12.92 and $13.02. At the midpoint, this translates to a valuation of 16 times net for the retailer's banal -- not costly if Lululemon tin show immoderate growth. But arsenic of today, some income and net look to beryllium shrinking.

If Lulu's to succeed, it whitethorn request caller management. Luckily, the institution besides conscionable announced that McDonald volition beryllium stepping down astatine the extremity of January, and the hunt for a successor has already begun. Ultimately, this may beryllium the existent crushed investors are buying Lulu banal today.

Before you bargain banal successful Lululemon Athletica Inc., see this:

The Motley Fool Stock Advisor expert squad conscionable identified what they judge are the 10 champion stocks for investors to bargain now… and Lululemon Athletica Inc. wasn’t 1 of them. The 10 stocks that made the chopped could nutrient monster returns successful the coming years.

Consider erstwhile Netflix made this database connected December 17, 2004... if you invested $1,000 astatine the clip of our recommendation, you’d person $507,421!* Or erstwhile Nvidia made this database connected April 15, 2005... if you invested $1,000 astatine the clip of our recommendation, you’d person $1,109,138!*