Can Lululemon Fend Off Rising Competition?

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Dec. 11 (Bloomberg) -- In today's Triple Threat, Macquarie Group's Liz Dunn and Bloomberg's Julie Hyman and Adam Johnson discuss the outlook for Lululemon. They speak with Trish Regan on Bloomberg Television's "Street Smart." (Source: Bloomberg)

Qwest tomorrow, lulu lemon has third-quarter earnings.

Moving on from the pr disaster it hopes ended yesterday when it appointed a ceo and dropped the infamous chip wilson as chairman.

Moments like this probably are not so good for lulu's image.

Some women's bodies do not work for it.

Qwest for the past?

They do not work for some women's bodies.

Beneath these outrageous comments and the marketing mess, is the company that has matched or surpassed earnings estimates every quarter since 2009 with betting on right here?

Or is it a bunch of bad pr that will amount to a declining stock price?

We want to ask our whole panel.

Julie, starting with you, is there a reason for investors to feel optimistic right now?

He was not the real issue of the company.

There are two main challenges that remain for lulu lemon.

One of them is the supply chain and getting that back in shape after the whole sheer pants situation, after really his comments serves to highlight it is still having issues getting the product on the shelves that is correct.

That is something the outgoing ceo christine day has struggled with.

It is something they will have to solve.

The other big issue is competition.

Everybody is getting into this market now.

In most cases, at lower price points.

If lulu lemon is going to succeed, it will have to fix the supply chain issue and get its brand image back on track.

A lot of people remain devoted to the brand despite all that happened.

Let me go over to us.

Tell us a little bit about him and whether you think he will have the chops to try to put this company back on course, and whether he can handle the pr onslaught that came the company's way in many ways and in many parts things to mr.


I think he has great expertise for this particular challenge.

Not so sure about the pr nightmare that has been the last couple of months.

In terms of running the company, fixing some of the sourcing issues and managing international growth, he has got a tremendous track record.

I spoke to some people surprised by the pic and thought they would hire somebody from another sportswear company, but that would be the wrong move.

I think it is such a unique culture and they have approached the market in such a different way than nike or under armour.

That is why they have been so successful with women.

You needed to bring in someone who had a quirky background.

He has really.

To back up those quirkier companies he has worked at.

Adam, how much is this stock affected by the news?

When chuck wilson made the comments to me about not all women's bodies really being appropriate for his yoga pants, did it have an effect on the stock?

Walk us through the charts.

Take a look at this.

In white, we are showing you lulu lemon's stock price.

In yellow, we have spikes the number of news stories that mentioned lulu lemon.

You can see the more news stories that came out, the lower the stock went.


What is curious is that you look at what has happened recently.

Maybe some of the new story flap has died down.

A little bumpier when he announced he would be leaving.

He had a little bump.

The stock is just starting to recover.

I would imagine if you are the pr agents for lulu lemon, you're hoping the what -- the yellow line goes down to zero.

You have got to get the other lineup.

Will it?

The news flow has turned somewhat positive.

I am waiting to see what they say tomorrow in terms of earnings.

I raise my price target.

This is good news.

The ceo higher and the reduced impact of chip in terms of his role on the board.

I think the news flow is changing.

People are taking a wait-and-see

This text has been automatically generated. It may not be 100% accurate.


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