Lululemon Athletica (LULU): Stock With Unusual Social Activity

Trade-Ideas LLC identified Lululemon Athletica (LULU) as an unusual social activity candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Lululemon Athletica

(

LULU

) as an unusual social activity candidate. In addition to specific proprietary factors, Trade-Ideas identified Lululemon Athletica as such a stock due to the following factors:

  • LULU has 16x the normal benchmarked social activity for this time of the day compared to its average of 16.29 mentions/day.
  • LULU has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $183.4 million.

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press? Bad press? It ultimately doesn't matter if it's good or bad if you know how to trade around the sentiment. Certain hedge funds use such data for their proprietary algorithms and it is not uncommon to see shared social sentiment play itself out in a stock's price trend.

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More details on LULU:

lululemon athletica inc., together with its subsidiaries, designs, manufactures, and distributes athletic apparel and accessories for women, men, and female youth. It operates through two segments, Corporate-Owned Stores and Direct To Consumer. LULU has a PE ratio of 28. Currently there are 15 analysts that rate Lululemon Athletica a buy, 1 analyst rates it a sell, and 9 rate it a hold.

The average volume for Lululemon Athletica has been 3.8 million shares per day over the past 30 days. Lululemon has a market cap of $6.9 billion and is part of the consumer goods sector and consumer non-durables industry. The stock has a beta of 0.27 and a short float of 28.5% with 7.77 days to cover. Shares are down 5.9% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Lululemon Athletica as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income and weak operating cash flow.

Highlights from the ratings report include:

  • LULU's revenue growth has slightly outpaced the industry average of 15.3%. Since the same quarter one year prior, revenues rose by 15.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • LULU has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 3.74, which clearly demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for LULULEMON ATHLETICA INC is rather high; currently it is at 50.49%. Regardless of LULU's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 10.52% trails the industry average.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed compared to the Textiles, Apparel & Luxury Goods industry average, but is greater than that of the S&P 500. The net income has decreased by 2.2% when compared to the same quarter one year ago, dropping from $48.75 million to $47.67 million.
  • Net operating cash flow has significantly decreased to $11.22 million or 78.83% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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