Lululemon downgraded to Neutral from Outperform at Baird

Baird analyst Mark Altschwager downgraded Lululemon (LULU) to Neutral from Outperform with a price target of $195, down from $225. The firm has low near-term confidence in the company’s growth and margin trajectory. It sees a higher degree of earnings uncertainty for Lululemon overshadowing the stocks’ “compelling valuation multiples” in the near term. This makes the stock difficult to recommend, the analyst tells investors in a research note. Baird prefers to wait for more conviction that Lululemon’s negative earnings revision cycle has run its course before recommending the shares.