NEW YORK (TheStreet) -- Lululemon Athletica's (LULU) - Get Report yoga pants and other apparel are still popular despite the recent flap over flimsy material. The company responded by exercising an immediate recall and then following up with improved materials and marketing as well as opening more stores.

But if you are an investor and not a yoga enthusiast, what do you think of the company's declining operating margins and gross profits when it faces competition from big players including Nike (NKE) - Get Report and Under Armour (UA) - Get Report?

Here's why you should stick with LULU. It has estimated sales of $1.8 billion for fiscal-year 2015 and has roughly 12% of the current $15 billion yoga apparel market. Its market share is projected to grow an additional 2% next year, reaching sales of more than $2 billion. Lululemon reports fourth-quarter and full-year results Thursday. 

In 2007 Lulu surpassed $100 million in sales -- an important landmark for the company. Three years later sales topped $1 billion in sales, which are projected to surpass $2 billion in 2016.

The company's track record has heightened expectations for the just-ended quarter as well as revenue and earnings projections for next year. These high expectations concern Camilo Lyon and Pallav Saini, analysts at Cannacord Genuity.

While citing the stock's recent rise, the analysts lowered their 2015 earnings estimates by almost 6% to $1.96 per share, down from $2.08 per share. "Given the stock’s rapid ascent…we believe the near-term downside risks have risen,” noted Lyon and Saini. LULU currently trades close to $62, up 11% for the year to date.

The analysts acknowledged the improvements the company has made to stabilize the business. But they believe the company's results may be adversely impacted by weather, forcing Lululemon to mark down some of its products.

Still, Lululemon's status as a premium brand is one of its advantages. If Cannacord is correct about weather-related impacts, it is narrow-sighted to assume the quarters and years ahead won't be better. If weather has an impact on sales in the just-ended quarter, Lululemon's advances in online sales -- projected to add 4% to comparable sales this quarter -- can offset some of that weakness.

The shares trade at only 30 times forward estimates of $2.06 per share compared with Nike's forward P/E of 25. Lulu stock is cheaper than Under Armour, which trades a forward multiple of 56. So it investors should ride this momentum.

This article is commentary by an independent contributor. At the time of publication, the author held no position in the stocks mentioned.