Lululemon Athletica: Hold Rating Amid Bold Product Strategy and Market Challenges

Tip Ranks
2025.10.16 08:55
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Aneesha Sherman has issued a Hold rating for Lululemon Athletica, citing concerns over its bold new product strategy launching in Spring 2026, which relies on an unproven designer and carries significant risks. The U.S. market trends are deteriorating, and while the Chinese market shows potential, it cannot compensate for U.S. challenges. Expected low single-digit EPS growth in FY26 and margin pressures have led to a valuation adjustment. The stock's short-term boost from the Amex partnership is noted, but long-term success depends on the new strategy's performance.