5 Reasons to Believe in
Lululemon’s Turnaround
Lululemon in downward dog position
What caused Lululemon’s downfall?
• Lulu was forced to
recall 17% of its
signature luon pants
last year because
they were
...
Other reasons for the selloff…
• Negative PR surrounding controversial
comments made by Lululemon’s founder
Chip Wilson.
•...
1. New leadership at the top
• Potdevin took over
for Mrs. Day in
January.
• As part of the
management shuffle,
the retail...
2. A cult-like following
• While investors have been quick to pull out of the
stock, customers keep coming back for more.
...
3. New opportunities in the men’s market
• Potdevin says Lulu’s
men’s segment could
become a billion-
dollar business.
• T...
4. A fresh product pipeline
• Items from the new
&go line cost 40%
more than the
retailer’s typical
yoga gear, which
could...
5. New product categories
• By adding new
product
categories
including beach
gear, cycling, and
running, Lulu is
addressin...
The hidden opportunity for investors
From new leadership at the top to a fresh product
mix, Lululemon’s turnaround is just...
Discover How Wearable
Tech Will Rock Your World
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5 Reasons You Should Believe in Lululemon's Turnaround

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Lululemon Athletica has struggled over the past year because of quality control issues with its signature luon yoga pants and a series of missteps by management. However, the athletic apparel retailer is finally poised for a comeback thanks to five catalysts.

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5 Reasons You Should Believe in Lululemon's Turnaround

  1. 1. 5 Reasons to Believe in Lululemon’s Turnaround
  2. 2. Lululemon in downward dog position
  3. 3. What caused Lululemon’s downfall? • Lulu was forced to recall 17% of its signature luon pants last year because they were inadvertently see- through. • This damaged Lulu’s reputation for quality. Shares of Lululemon are down nearly 25% so far this year.
  4. 4. Other reasons for the selloff… • Negative PR surrounding controversial comments made by Lululemon’s founder Chip Wilson. • The sudden exit of former chief executive Christine Day. However, as you’ll see in the following slides there are plenty of reasons to be optimistic about the retailer’s comeback.
  5. 5. 1. New leadership at the top • Potdevin took over for Mrs. Day in January. • As part of the management shuffle, the retailer’s founder Chip Wilson resigned from his position as chairman of the board. Meet Laurent Potdevin, Lulu’s new CEO.
  6. 6. 2. A cult-like following • While investors have been quick to pull out of the stock, customers keep coming back for more. • Lulu beat estimates for its fiscal fourth quarter, reporting a 7% jump in net revenue to $521 million. • The retailer also achieved double-digit sales growth in its direct-to-consumer segment, earning $97.8 million in online sales during the fourth quarter.
  7. 7. 3. New opportunities in the men’s market • Potdevin says Lulu’s men’s segment could become a billion- dollar business. • The slacks shown to the right cost $128 and are already nearly sold out online. Lululemon is making a greater push into men’s fitness and everyday apparel.
  8. 8. 4. A fresh product pipeline • Items from the new &go line cost 40% more than the retailer’s typical yoga gear, which could boost Lulu’s margins if they’re a hit with customers. Lulu’s new line for women dubbed “&go” could reinvigorate the brand.
  9. 9. 5. New product categories • By adding new product categories including beach gear, cycling, and running, Lulu is addressing new growth markets. Lululemon is diversifying its product mix in a big way.
  10. 10. The hidden opportunity for investors From new leadership at the top to a fresh product mix, Lululemon’s turnaround is just starting to take form. Yet, Lululemon’s stock is stuck in the dumps… trading around $45 today, or nearly 46% below its 52-week high. This creates an opportunity for investors to get in at the bottom. Investors can get more insight into Lulu’s business when the retailer reports fiscal 2014 first-quarter earnings on Thursday, June 12.
  11. 11. Discover How Wearable Tech Will Rock Your World

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