Lululemon Pricier Than Peers Given Growth Profile
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Lululemon valuation is richer than many of its peers in the retail sector. Shares jumped as much as 14% today after the athletic clothing retailer reported second quarter revenue above analyst expectations, a sign that investors are still willing to pay significant premiums for growth.
Lululemon trades at a last-twelve-months price-to-earnings ratio of 65.4 compared to 16.9 for the S&P Retail Select Industry Index. Its price-to-earnings ratio is also higher than other companies in the athletic space such as Nike, Under Armour and Adidas. Lululemon is also growing revenue at a rate much higher than its peers.