The company offered fourth-quarter revenue guidance of $475 million to $480 million on a same-store sales increase in the high single digits. EPS is expected to total $0.71 to $0.73. The consensus estimates currently call for EPS of $0.75 on revenues of $490.5 million.
For the full fiscal year, Lululemon expects EPS of $1.81 to $1.83 on revenues of $1.36 million to $1.365 billion. The current consensus calls for EPS of $1.82 on revenues of $1.36 billion.
The company’s CEO did some cheerleading:
I am very proud of the team for achieving yet another strong quarter coming in ahead of our expectations. Our stellar results were driven by first-rate execution, strong community engagement, beautiful product and continued strength in our ecommerce business.
Lululemon’s same-store sales rose 18% in the quarter on a constant dollar basis and gross profit rose 36%. Gross margin slipped slightly, from 55.8% to 55.4% year-over-year. Operating margins also slipped, from 25.9% to 25.5%.
The big issue for the company’s stock is the forecast for same-store sales growth. In the fourth quarter of last year, sales rose 26%. A forecast for growth in the high single digits simply lowers investors’ expectations. Lululemon may be being cautious (sandbagging?), but the firm’s guidance is not encouraging.
Shares are down about 2% in premarket trading this morning, at $67.25 in a 52-week range of $42.75 to $81.09. Thomson Reuters had a consensus analyst price target of around $81.90 before today’s results were announced.
Paul Ausick
Get Ready To Retire (Sponsored)
Start by taking a quick retirement quiz from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes, or less.
Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.
Here’s how it works:
1. Answer SmartAsset advisor match quiz
2. Review your pre-screened matches at your leisure. Check out the advisors’ profiles.
3. Speak with advisors at no cost to you. Have an introductory call on the phone or introduction in person and choose whom to work with in the future
Get started right here.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
