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Lululemon Shares Fall After Earnings Beat, Guidance Raise

The athleisure retailer's shares fell after third quarter results and guidance were strong. The stock had risen 12.5% in the month leading up to earnings.

Shares of Lululemon Athletica  (LULU) - Get lululemon athletica inc. Report fell after the company beat revenue and earnings expectations and raised guidance. 

The stock fell 4.7% to $222.30 in after-hours trading, after having gained 1.5% in the regular session. 

Earnings per share came in at 96 cents, up 35% from 71 cents in the year-earlier quarter. The latest result beat analysts' estimates of 94 cents, as measured by a FactSet survey. Total revenue advanced 23% to $916 million, beating Wall Street estimates of $899 million. 

Comparable sales grew 16%. Net store count grew by 19 to a total of 479. 

Direct-to-consumer revenue increased 29%. The DTC revenue stream accounted for 26.9% of total revenue for the quarter, compared with 25.3% in the year-ago quarter. 

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Operating margin was 19.2%, a full percentage point increase year-over-year and better than the expected 18.6%. 

"We are successfully executing on our Power of Three growth plan as we create authentic connections with new and existing guests around the world," said CEO Calvin McDonald. 

Management raised full year 2019 revenue and EPS guidance. 

The company now forecasts revenue of $3.9 billion to $3.91 billion, up from a prior forecast of $3.8 billion to $3.84 billion. The new range is higher than analysts' estimate of $3.89 billion. 

The company now expects EPS of $4.75 to $4.78, up from a prior forecast of $4.63 to $4.70. The new range exceeds analysts' expectations of $4.75. 

The stock had risen 12.5% in the past month, beating the S&P 500's 1.6% gain in that period. The stock is also up more than 80% for the year, as the company has beaten expectations and raised guidance multiple times this year.