Lululemon Athletica Inc. (NASDAQ: LULU) is seeing its shares battered this morning after the company’s earnings forecast is just not enough to keep the buzz going here. What is interesting is that analysts and investors had been operating under the assumption that Lululemon’s supply chain was expanded in a manner that would let it meet higher demand. The drop we are seeing today may be a case of good is just not good enough.

The yoga-themed retail destination said that its fourth-quarter sales will be at the high-end of its original forecast of $475 million to $480 million. The problem is that consensus was looking more like $489 million. The bar has been set high for this major growth company. This is also the company’s key fourth quarter, which adds so much to the annual numbers. The company’s earnings also will come in around the $0.74 EPS that matches the consensus reading.

Shares are down 6.2% at $67.82 on the news in active trading, after closing at $72.30 on Monday. Lululemon has a 52-week range of $52.20 to $81.09, but it also had a market cap of $10.4 billion before today’s drop in the shares.

Some investors may feel that the discount off of the year high was enough of a pullback, but that might not be the case as this one has risen massively. As far as valuation, this one also trades at 38-times earnings and more than 7.5-times revenues. Those are both huge premiums for the apparel and retail sectors.

Thomson Reuters has a consensus price target for Lululemon is $81.81 before the effects of this drop.

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