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Lululemon Athletica Faces Decline
Lululemon Athletica Inc. (NASDAQ: LULU) has seen a staggering 1,090% increase since its IPO in 2007, yet year-to-date as of November 19, 2023, it is down 57%, making it one of the worst performers in the S&P 500. Comparable sales in North America have declined by 4% in the second quarter.
International Sales and Future Strategy
Despite struggles domestically, Lululemon reported a 15% increase in comparable sales internationally, particularly thriving in China where comparable sales jumped 17%. The company plans to improve its product offerings by increasing the percentage of new styles from 23% to 35% by next spring.
Valuation Insights
Following its recent sell-off, Lululemon’s price-to-earnings (P/E) ratio is now at 11.3, its lowest valuation since the financial crisis, indicating low growth expectations from investors.
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