NEW YORK (TheStreet) -- Lululemon Athletica Inc. (LULU) is scheduled to report its 2014 third quarter earnings results before the market open on Thursday, December 11, and analysts are expecting the designer and retailer of athletic apparel to report mixed results for the latest quarter.
For the most recent quarter analysts are expecting Lululemon to post earnings of 38 cents per share on revenue of $424.68 million.
Analysts are expecting a year-over-year rise in net sales, but a year-over-year decline in earnings per share.STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
For the 2013 third quarter the company reported diluted earnings of 45 cents per share, on revenue of $379.9 million.
Shares of Lululemon are down by 1.91% to $46.82 in late afternoon trading on Wednesday.
Separately, TheStreet Ratings team rates LULULEMON ATHLETICA INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate LULULEMON ATHLETICA INC (LULU) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Despite its growing revenue, the company underperformed as compared with the industry average of 16.4%. Since the same quarter one year prior, revenues rose by 13.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- LULU has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 6.39, which clearly demonstrates the ability to cover short-term cash needs.
- Net operating cash flow has increased to $53.01 million or 15.75% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 1.98%.
- The gross profit margin for LULULEMON ATHLETICA INC is rather high; currently it is at 53.99%. Regardless of LULU's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, LULU's net profit margin of 12.47% compares favorably to the industry average.
- LULULEMON ATHLETICA INC's earnings per share declined by 15.4% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, LULULEMON ATHLETICA INC increased its bottom line by earning $1.91 versus $1.85 in the prior year. For the next year, the market is expecting a contraction of 7.3% in earnings ($1.77 versus $1.91).
- You can view the full analysis from the report here: LULU Ratings Report