anney notes the stock is trading down due to lower than expected guidance and sequentially slowing comp. As they expected, the co guided 2Q12 conservatively (but even lower than they were expecting. Most concerning is the deceleration in comp from 25% in 1Q12 to a guided comp of positive low double digits. LULU remains an attractive longer term growth story, and they believe earnings growth is still above 30% annually for the next several years. However, they point out the earnings growth vs. valuation disparity that has existed is likely to converge, and we expect that stock appreciation from today’s corrected levels may be more measured and more in line with actual earnings growth prospects from the co; Buy.
LULU is at $61.83 in the premarket.
Joined Nov 11, 2007
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