Lululemon's Strong Q3 Results and Increased Share Buyback Program
Lululemon Athletica Inc. (LULU) reported better-than-expected third-quarter financial results, leading to a surge in its share price. The company also announced a $1 billion increase to its share buyback program, demonstrating its confidence in its future prospects.
During the third quarter, Lululemon repurchased 1.6 million shares of its common stock for $408.5 million. Additionally, it approved a $1 billion increase to its share repurchase program, bringing the total authorized repurchases to approximately $1.8 billion. This move indicates the company's commitment to returning value to shareholders.
Lululemon also issued guidance for the 2024 fourth quarter, projecting revenue between $3.475 billion and $3.510 billion. This surpasses analyst estimates of $3.496 billion, suggesting continued strong performance for the company.
Following the earnings release, several analyst firms raised their price forecasts on Lululemon stock. Analysts cited the company's strong growth potential, international expansion opportunities, and effective cost control as key drivers for their optimism.
Stifel: Analyst Jim Duffy reiterated a Buy rating and raised the price target to $438, citing Lululemon's strong growth potential and international expansion opportunities.
Analyst Matthew R. Boss reiterated an Overweight rating and increased the price target to $425, highlighting the company's strong domestic market potential and international expansion opportunities.
Analyst Brooke Roach maintained a Neutral rating but raised the price target to $365, encouraged by Lululemon's sequential business improvement and strong start to the holiday season.
Analyst Ashley Owens reiterated an Overweight rating and boosted the price target to $400, seeing opportunities for innovation and growth in various product categories and international markets.
Analyst Joseph Civello reiterated a Buy rating and raised the price target to $420, noting the streamlining of Lululemon's product development process and the potential for new product offerings to drive growth.
Analyst Robert Drbul maintained a Buy rating and raised the price target to $415, acknowledging the promising start to the holiday season but remaining cautious due to macroeconomic uncertainties.
Overall, the analysts' positive outlook reflects Lululemon's strong financial performance, growth potential, and commitment to shareholder value. The company's increased share buyback program further underscores its confidence in its future prospects.