Lululemon Athletica (Nasdaq: LULU) Announces Q3 Results and Share Repurchase

Market Mover Alert on Lululemon Athletica Inc. – Nasdaq ticker: LULU

Lululemon Athletica Inc. announced third quarter results yesterday and its stock (LULU) has seen a price bump amid high volumes.

Lululemon Athletica is a Vancouver, Canada based company that designs and sells athletic wear. Products include performance shirts, shorts, pants, and lifestyle apparel and yoga accessories. Sold internationally, they compete with Athleta, Nike, and Under Amour.

From Lululemon Atheltica’s press release:

For the third quarter ended October 30, 2016:

  • Net revenue increased by 13% to $544.4 million from $479.7 million in the third quarter of fiscal 2015.
  • Total comparable sales, which includes comparable store sales and direct to consumer, increased by 7%.
  • Comparable store sales increased by 4%.
  • Direct to consumer net revenue increased by 16% to $104.0 million.
  • Gross profit increased by 24% to $278.4 million, and as a percentage of net revenue gross profit was 51.1% compared to 46.9% in the third quarter of fiscal 2015.
  • Income from operations increased by 36% to $93.0 million from $68.2 million in the third quarter of fiscal 2015, and as a percentage of net revenue was 17.1% compared to 14.2% of net revenue in the third quarter of fiscal 2015.
  • Diluted earnings per share for the third quarter of fiscal 2016 were $0.50 compared to $0.38 in the third quarter of fiscal 2015.

 

Of possibly more importance was the announcement that Lululemon Athletica’s board has approved a share buy-back.

The Company also announced that its board of directors has approved a stock repurchase program for up to $100 million of its common shares in the open market at prevailing market prices. The timing and actual number of common shares to be repurchased will depend upon market conditions and other factors, in accordance with Securities and Exchange Commission requirements. The stock repurchase program is intended to create shareholder value by making opportunistic repurchases during periods of favorable market conditions. Shares may be repurchased from time to time on the open market, through block trades or otherwise. Purchases may be started or stopped at any time without prior notice depending on market conditions and other factors.”

LULU stock, traded on the Nasdaq, is up over 16% in morning trading on heavy volume.

Ticker Symbol LULU
Last Price a/o 11:45 EST  $             69.37
Average Volume 2.3 million
Market Cap 8.3 Billion
Sales $2.2 Billion
Shares Outstanding 140.1 million
Share Float 106.7 million
Shortable Yes
Optionable Yes
Inside Ownership 0.10%
Short Float 13.60%
Short Interest Ratio 6.25
Quarterly Return -9.44%
YTD Return 14.05%
Year Return 14.72%

Author: Steve Clark

Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading. Steve keeps his head in the game by looking for, and writing about, small companies that often get overlooked by the big investment firms.

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