Jim Cramer Discusses lululemon Pricing Challenges and Consumer Trends

lululemon athletica inc. (NASDAQ:LULU) is one of the stocks on Jim Cramer’s radar. Cramer explained the recent drop in the stock price, as he commented:

“If you want to know why the stock of lululemon plunged over 18% today, look no further than a lawsuit the company filed against Costco last June for allegedly selling virtually identical knockoffs… Look, Lulu’s a special company that makes special products, but I’ve never met a soul in the last few years that didn’t say within a breath of mentioning something that they liked, that, of course, it’s very expensive.

Have you ever heard anyone say… that something from Costco’s too expensive? Have you ever heard of anyone say that it’s not of similar quality to the product that it rivals, if not better? Notice I didn’t say mimics or infringes, I said rivals because that’s how the American people view the relationship…

To me, companies like Costco and Amazon are Avengers. They recognize that we’re mad as hell. We’re just not going to take these prices anymore… So let the decline and perhaps fall of Lululemon be a sign that Americans want value, not status. Or to be more positive, they want value and the status of not being seen as dupes for paying full price just for a brand name. If you’re an apparel company, and you can’t figure that out, then take your prices down and stop trying to please both Wall Street and Main Street, because in the end, it’s Main Street that makes the purchasing decisions and only determines what Wall Street has to say and not vice versa.”

lululemon athletica inc. (NASDAQ:LULU) designs and sells athletic apparel, footwear, and accessories for both men and women, with products focused on yoga, running, training, and lifestyle wear.

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Disclosure: None. This article is originally published at Insider Monkey.