Lululemon once again proves skeptics wrong |
| MarketWatch - Dec 6, 2012 |
Lululemon Athletica, the trendy maker of yoga-inspired athletic clothes, on Thursday proved skeptics wrong again, outperforming its competition by reporting a jump in quarterly comparable sales and fending off challenges from rivals including Gap Inc.’s Athleta and Nike.
On Thursday, the company reported an 18% increase in third-quarter comparable sales, excluding the impact of currency translations. That compared with a 5.4% average increase for apparel retailers in the quarter, according to Retail Metrics.
Online and other direct-to-consumer sales surged 89%. Total profit rose 48% to $57.3 million, or 39 cents a share, while sales surged 37% to $316.5 million, both above Wall Street expectations.
Some analysts have cast doubt on Lululemon’s ability to thrive as other, larger companies have invaded its turf and put out lines of clothing and products that are similar to Lululemon’s. But investors appeared willing to give the Vancouver-based company the benefit of the doubt.
Unlike other retailers from Men’s Wearhouse Inc. to Vera Bradley Inc. whose stocks were punished Thursday after they gave disappointing fourth-quarter outlooks, investors overlooked Lululemon’s also cautious fourth-quarter guidance. It forecast comparable-store sales would rise in the high-single-digits and said it expected profit of 71 cents to 73 cents a share, both missing analysts’ expectations.
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- Posted: 2012-12-06 14:11:53
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