Lululemon vs Dick's Sporting Goods
This page compares Lululemon and Dick's Sporting Goods, outlining business models, financial performance and market context in clear, neutral terms for readers. It explains how each company creates value, operates its channels and competes in its sector, without offering advice. Educational content, not financial advice.
This page compares Lululemon and Dick's Sporting Goods, outlining business models, financial performance and market context in clear, neutral terms for readers. It explains how each company creates va...
Why It's Moving
Lululemon beats Q3 sales estimates and boosts buyback as CEO departs, sparking 10% stock surge.
- Q3 revenue hit $2.57B, beating estimates by 3.7% and signaling resilient demand despite 1% same-store sales growth slowdown[1].
- EPS of $2.59 crushed expectations by 17.1%, though next-quarter guidance missed slightly, highlighting operational strength with caution ahead[1].
- CEO Calvin McDonald steps down in January after a tough year, a move investors welcomed, plus $1B buyback hike to boost confidence[1][4].
Lululemon beats Q3 sales estimates and boosts buyback as CEO departs, sparking 10% stock surge.
- Q3 revenue hit $2.57B, beating estimates by 3.7% and signaling resilient demand despite 1% same-store sales growth slowdown[1].
- EPS of $2.59 crushed expectations by 17.1%, though next-quarter guidance missed slightly, highlighting operational strength with caution ahead[1].
- CEO Calvin McDonald steps down in January after a tough year, a move investors welcomed, plus $1B buyback hike to boost confidence[1][4].
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Published: July 25, 2025
Explore BasketGlobal Sportswear's Tariff Test
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Explore BasketWhich Baskets Do They Appear In?
Navigating The Sportswear Shake-Up
Puma's recent profit warning, driven by U.S. tariffs and weak demand, signals a broader disruption in the sportswear industry. This situation creates a potential opening for rival brands to gain market share and for off-price retailers to benefit from sector-wide inventory challenges.
Published: July 25, 2025
Explore BasketGlobal Sportswear's Tariff Test
Puma's recent profit warning, triggered by U.S. tariffs and declining sales, has sent shockwaves through the sportswear sector. This event highlights a critical investment theme focused on how global apparel companies are navigating geopolitical trade risks and shifting consumer markets.
Published: July 25, 2025
Explore BasketResilient Sportswear Plays Beyond The Tariff
Following Puma's significant profit warning due to U.S. tariffs, an investment opportunity emerges in the sportswear sector. This theme focuses on athletic apparel companies with resilient supply chains and less exposure to the trade policies impacting global brands.
Published: July 25, 2025
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Explore BasketInvestment Analysis
Lululemon
LULU
Pros
- Lululemon has a historically strong return on equity averaging around 33% over five years, indicating efficient profitability.
- The company anticipates revenue growth of 4% to 6% for the full year 2025 despite challenging macro conditions.
- Lululemon aims to reach its Power of Three x2 goals by fiscal 2026, implying a significant revenue increase to $12.5 billion.
Considerations
- The stock declined nearly 57% in 2025, mainly due to decelerating growth and increased reliance on markdowns affecting gross margins.
- Earnings per share are expected to decline by 11% to 13% in 2025, reflecting margin pressure from inflation and tariffs.
- Market sentiment is bearish with forecasts predicting a further price drop toward approximately $156 by year-end 2025.
Pros
- Dick's Sporting Goods maintains a strong return on equity at approximately 37%, higher than Lululemon, indicating solid profitability.
- The company possesses a robust competitive position primarily operating within the U.S. market with a diversified store base.
- Dick's benefits from being a major omnichannel retailer with effective integration of brick-and-mortar and direct-to-consumer segments.
Considerations
- Exposure to U.S.-centric retail market makes Dick's susceptible to domestic economic fluctuations and consumer spending shifts.
- The sporting goods sector is cyclical and sensitive to macroeconomic headwinds which can impact sales unpredictably.
- Competition from both specialist and general retailers intensifies pricing and promotional pressure, potentially hurting margins.
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