lululemon athletica inc. (LULU): a likely value trap?

Avoid — this is a multi-year structural slowdown (US sales shrinking, tariffs, lost CEO, rising competition), not a temporary panic.

⚠ TRAP Fundamentals57/100

Down 81% from its all-time high of $511.29 — now $96.19

Why LULU dropped

LULU has fallen for two straight years on a steady drumbeat of bad news: tariffs cutting margins, North American/US sales now actually shrinking (down 8% most recently), intensifying competition from Vuori/Alo, customer complaints about product quality, and a leadership vacuum after CEO Calvin McDonald's exit with no permanent replacement plus governance fights with founder Chip Wilson.

Fwd P/E 11.2Op margin 13.2%Rev growth -4.3%Debt/equity 44.7%Analyst upside 8.6%

How this scored 57/100

✅ Passes all 4 hard checks — profitable, cash-generative, and financially survivable.

✅ Makes money Net profit margin 12.8%

✅ Generates cash Free cash flow $1.1B

✅ Not drowning in debt Debt/equity 44.7% (limit 200%)

✅ Can pay its bills Current ratio 2.2 (needs 1+)

Bar length shows how much each metric is worth — a 10-point metric is twice as wide as a 5-point one. Hover any row for what it means.

Profitability Does it actually make money? 18/25

Operating margin 13.2% 5/9

Net profit margin 12.8% 5/8

Return on equity 30.9% 8/8

Growth Is it getting bigger, or dying? 1/25

Revenue growth -4.3% 0/9

Earnings growth -5.9% 1/8

Expected profit change -28.3% 0/8

Value Is it cheap right now? 16/25

Forward P/E 11.2 9/10

PEG ratio 1.1 6/8

Analyst target upside 8.6% 1/7

Balance sheet Will it survive? 22/25

Debt / equity 44.7% 9/10

Current ratio 2.2 6/8

Free cash flow $1.1B 7/7

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Analysis generated by SmartStonks's AI from public fundamentals and news, first flagged 2026-10-01. Research only — not financial advice.