William Blair analysts are raising their estimates for Lululemon Athletica (NASDAQ:LULU) on the expectation of robust holiday sales, the firm said in a note to clients this week.
Analysts believe Lululemon's broad-based strength continued in December and expect its fourth-quarter sales and earnings outlook to be raised in tandem with the ICR Conference, which will be held between January 8th and 10th.
"In contrast to last year, when severe winter weather curtailed last-minute traffic, both the U.S. and Canada experienced unseasonably mild weather prior to Christmas this year," said the analysts, who maintained an Outperform rating on the stock. "Moreover, store traffic was robust during our pre- and post-Christmas checks, and similar to last year, there was little markdown activity prior to Christmas."
William Blair now expects revenue growth of nearly 16% in the fourth quarter (versus 15% previously and ahead of guidance of 13% to 14%). In addition, it has increased its fourth-quarter EPS estimate to $5.02, up 14% and ahead of consensus of $4.95 and guidance of $4.85 to $4.93.