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Lululemon Analysts Lift Targets on Strength Amid Retail Woe

Lululemon analysts are raising their price targets on the stock of the athleisure retailer.

A number of Lululemon Athletica  (LULU) - Get Lululemon Athletica Inc (LULU) Report analysts increased their share-price targets on the prominent athleisure-apparel retailer ahead of Thursday’s scheduled earnings report.

MKM Partners analyst Roxanne Meyer raised her price target to $378 from $230 and maintained her buy rating.

Lululemon’s earnings should increase over the next two years, as the company emerges a winner in the "shakeout in retail" caused by the coronavirus pandemic, she said in a commentary cited by The Fly.

The shift to online shopping and strong consumer demand for technical and casual attire should help Lululemon, Meyer said.

For the long term, the company should benefit from other "material catalysts," including the national launch of its loyalty program, faster customer growth, and widening profit margins thanks to online transactions.

Meanwhile Deutsche Bank boosted its price target for Lululemon to $241 from $197. 

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Last week, Oppenheimer lifted its price target to $370 from $296.

Bank of America Securities raised its target for Lululemon to $230 from $220, affirming a buy rating. 

And Wells Fargo lifted its target price to $275 from $250.

To be sure, Wells Fargo downgraded Lululemon to equal weight from overweight in light of its surge over the past three months - 44%, compared with 8% for the S&P 500 index.

Wells Fargo analyst Ike Boruchow wrote in a report that the stock now has a more balanced risk/reward equation, given there’s still “plenty of risk in the consumer environment ahead,” Bloomberg reports.

Lululemon shares recently traded at $314.63, down 1.6%.