This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Kors Is Too Expensive, Lululemon Is Just Right

NEW YORK (TheStreet) - Michael Kors (KORS - Get Report) was sinking 3.2% to $79.42 after Citigroup analyst Oliver Chen downgraded the stock to "neutral" from "buy" on Tuesday.

Chen said in an investor note that the downgrade was primarily related to the stock's rich valuation though he did express concern about slower accessory sales at other retailers, particularly in watches, "which convey a possibility of lack of upside" to Kors' stock.

KORS Chart
KORS
data by YCharts

Conversely, Lululemon (LULU - Get Report) shares were rising 1.2% to $58.46 after D.A. Davidson upgraded the yoga apparel maker's stock to "buy" from "neutral" and raised its 12-month price target by $6 to $73.

Analyst Andrew Burns is more optimistic on the Vancouver-based company given lululemon's long-term growth potential and expectations that a new year and a new CEO will restore the troubled company's luster.

Must Read: Men's Wearhouse Gets Hostile With Jos. A. Bank Offer (Update 1)

"Despite2013 hiccups, the lululemon brand remains the leader in an attractive category," Burns writes in a note. "Consumer interest in lululemon remains incredibly high.

Over the holidays, LULU stores were consistently one of the most crowded and exciting stores at each shopping location we visited. Athletic brands as well as new entrants are making the category more competitive, but LULU remains the benchmark from both a product style and quality standpoint.

This leadership position was dented in 2013, but with new management and improved internal controls, we believe the supply chain and PR troubles of 2013 are surmountable."

--Written by Laurie Kulikowski in New York.

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
KORS $43.28 0.00%
LULU $62.64 0.00%
AAPL $112.92 0.00%
FB $89.73 0.00%
GOOG $637.61 0.00%

Markets

Chart of I:DJI
DOW 16,654.77 +369.26 2.27%
S&P 500 1,987.66 +47.15 2.43%
NASDAQ 4,812.7080 +115.1720 2.45%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs