Stock Analysis & Ideas

Lululemon Will Report Q4 Earnings Today: What do its Website Visit Trends Indicate?

Lululemon Athletica Inc. (LULU) will reveal its fourth-quarter financial results after the market closes today. This Canadian retailer sells apparel, athleisure, and lifestyle gear, as well as personal care products and accessories.

About 50% of Lululemon’s revenue comes from ecommerce sales of its products. As a result, total website visits are a good indicator of how engaged users are with Lululemon’s platform. Increased website visitors suggest a higher demand for the company’s products, implying higher digital sales and vice versa.

Given Lululemon’s focus on digitization, it’s worth looking into the website visit trend ahead of the Q4 print to have a better picture of the company’s current state.

Lululemon Q4 Website Visits Stats

We discovered through the tool that overall projected visits to the Lululemon website decreased in Q4. In particular, the total projected worldwide visits to increased by 33.2% sequentially from the third quarter.

Lululemon’s online sales may have increased in the yet-to-be-reported quarter, based on the growth in monthly users. The company is projected to gain from demand tailwinds during the holiday season, including the drive toward health, wellness, and preference for athleisure.

In addition, website visitors fell 22.4% year-over-year to 31.2 million in Q4.

While Lululemon’s ecommerce achievements are evident, supply chain challenges, workforce constraints, and inventory issues may have had impacted the company’s earnings to some extent.

Wall Street’s Take

Wall Street analysts are cautiously optimistic about Lululemon, with a Moderate Buy consensus rating based on 13 Buys, six Holds, and one Sell. The average Lululemon stock prediction of $418.61 implies upside potential of approximately 26.2% to current levels for this stock.

Bottom Line

With brick-and-mortar sales rebounding as customers return to stores, Lululemon’s internet traffic indicates that the company could also witness strong online sales in the fourth quarter.

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