Lululemon Athletica Inc. (LULU): Today's Featured Consumer Goods Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model

Lululemon Athletica ( LULU) pushed the Consumer Goods sector lower today making it today's featured Consumer Goods laggard. The sector as a whole closed the day down 0.6%. By the end of trading, Lululemon Athletica fell $2.49 (-3.5%) to $68.85 on average volume. Throughout the day, 3,806,939 shares of Lululemon Athletica exchanged hands as compared to its average daily volume of 2,715,500 shares. The stock ranged in price between $68.36-$71.51 after having opened the day at $71.31 as compared to the previous trading day's close of $71.34. Other companies within the Consumer Goods sector that declined today were: Central European Distribution ( CEDC), down 21.6%, Crumbs Bake Shop ( CRMB), down 15.4%, Bassett Furniture Industries ( BSET), down 9.3% and China New Borun Corporation ( BORN), down 9.2%.
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lululemon athletica inc., together with its subsidiaries, designs, manufactures, and distributes athletic apparel and accessories for women, men, and female youth. It operates in three segments: Corporate-Owned Stores, Direct To Consumer, and Other. Lululemon Athletica has a market cap of $7.9 billion and is part of the consumer non-durables industry. The company has a P/E ratio of 37.9, above the S&P 500 P/E ratio of 17.7. Shares are down 8.1% year to date as of the close of trading on Wednesday.

TheStreet Ratings rates Lululemon Athletica as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

On the positive front, Orbital Corporation ( OBT), down 5.6%, SGOCO Group ( SGOC), down 5.5%, Koss Corporation ( KOSS), down 4.8% and Allison Transmission Holdings ( ALSN), down 4.4% , were all gainers within the consumer goods sector with Hasbro ( HAS) being today's featured consumer goods sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the consumer goods sector could consider iShares Dow Jones US Cons Goods ( IYK) while those bearish on the consumer goods sector could consider ProShares Ultra Sht Consumer Goods ( SZK).

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