Shares of retailer Lululemon (NASDAQ:LULU) tanked in after-hours trading after the company reported earnings for its fourth quarter of Fiscal Year 2023 along with soft guidance. Earnings per share came in at $5.29, which beat analysts’ consensus estimate of $5 per share.
Sales increased by 15.9% year-over-year, with revenue hitting $3.21 billion. This beat analysts’ expectations by $10 million. Gross profit increased to $1.9 billion, which equates to a 25% growth rate. Furthermore, adjusted operating margin increased by 20 basis points to 28.5%.
Looking forward, management now expects revenue and adjusted earnings per share for Q1 2024 to be in the ranges of $2.175 billion to $2.2 billion and $2.35 to $2.40, respectively. For reference, analysts were expecting $2.26 billion in revenue along with an adjusted EPS of $2.55.
Is LULU a Good Stock to Buy Now?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on LULU stock based on 15 Buys, three Holds, and two Sells assigned in the past three months, as indicated by the graphic below. After a 56% rally in its share price over the past year, the average LULU price target of $516.16 per share implies 8.73% upside potential. However, it’s worth noting that estimates will likely change following today’s earnings report.
