Stifel Nicolaus upgraded athletic apparel company Lululemon Athletica Inc. (LULU) - Get Report to buy from hold Monday and maintained the price target of $151.

"While comps will inevitably slow against difficult compares, we believe double-digit revenue growth can continue," Stifel analyst Jim Duffy said in a research note.

Duffy also said that he sees upside potential for fourth quarter and 2019 estimates, and views the 2020 objective of $4 billion in revenue and implied earnings power of $5 a share as "low hurdles."

"Following leadership changes in the past few years, we view Lululemon as one of the highest quality companies in our coverage and with e-commerce execution," he wrote, "we view it as arguably the most powerful business model."

Duffy also said that while there is no shortage of uncertainty in the market, he viewed the pullback in Lululemon shares "as an entry point for a high-quality large cap growth business with runway."

He noted that despite fundamental strength, the Vancouver, Canada-based company's stock multiple has compressed, resulting in a 26.7% selloff in shares since the September 28 highs.

"We have been favorably impressed with the leadership team and believe the Company is only just beginning to execute to the ecommerce potential," he wrote. "With market tailwinds from growing global concern for health, fitness, and self-actualization, we believe lululemon has a long runway for global growth and advocate owning shares as a core holding."

Shares were up 0.5% to $119.68 on Monday.