BofA Cuts Lululemon (LULU) PT to $185 on Slower China Growth, Reduced Full-Year Revenue Guidance

Lululemon Athletica Inc. (NASDAQ:LULU) is one of the best Canadian stocks to buy now. On September 12, BofA analyst Lorraine Hutchinson lowered the firm’s price target on Lululemon to $185 from $210, while keeping a Neutral rating on the shares to reflect slower China growth and better tariff mitigation. While BofA is raising its FY2026 EPS estimate by 1% to $13.15, it is reducing its price target to reflect a lower sales growth rate.

This sentiment was posted after the company announced its FQ2 2026 financial results, with a total net revenue of $2.5 billion, which marked a 7% increase year-over-year. However, revenue fell short of guidance, leading the company to reduce its revenue and earnings expectations for the full year FY2026. The updated full-year revenue guidance is now set between $10.85 and $11 billion, which reflects an expected growth of 2% to 4% relative to 2024. EPS guidance for 2025 is between $12.77 and $12.97.

For Q2, the company’s gross profit was $1.48 billion, or 58.5% of net revenue. Operating income totaled ~$524 million, or 20.7% of net revenue. Net income for the quarter was $371 million, which resulted in an EPS of $3.10 per diluted share. Comparable sales increased by 1%. The store channel saw a 3% sales increase, with 14 net new stores opened during the quarter, bringing the global store count to 784. Digital channel revenue grew by 9%, contributing $1 billion to the top line.

Lululemon Athletica Inc. (NASDAQ:LULU) designs, distributes, and retails technical athletic apparel, footwear, and accessories for women and men under the lululemon brand internationally.

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