Will strength across categories and stronger store traffic push Lululemon's Q4 Earnings higher?
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Lululemon (NASDAQ:LULU) is scheduled to announce Q4 earnings results on Tuesday, March 29th, after market close.
Beating earnings expectations in prior three quarters, the consensus EPS Estimate is $3.27 (+26.7% Y/Y) and the consensus Revenue Estimate is $2.13B (+23.1% Y/Y).
Over the last 2 years, LULU has beaten EPS estimates 88% of the time and has beaten revenue estimates 88% of the time.
Over the last 3 months, EPS estimates have seen 2 upward revisions and 21 downward. Revenue estimates have seen 1 upward revision and 18 downward.
Quick look at the company's profitability metrics in comparison to peers:



Lululemon has been leveraging its stores to facilitate omni-channel capabilities, including the buy online pick up in store and ship from store; continued investments to enhance the in-store experience are likely to have bolstered sales and earnings in Q4.
Capex is estimated to be between $375 to $385M for 2021.
Management expects FY21 gross margin to be affected by 150-200 bps of higher airfreight expenses; negative impact of 450 basis points from airfreight costs due to congestion and capacity constraints in Q4.
For SG&A, it sees leverage of 50 to 100 basis points versus 2020; EPS guidance of $7.69 to $7.76 (vs. prior $7.38 to $7.48) continues to assume modest dilution from MIRROR in the 3% to 5% range, excluding acquisition and integration related costs.
In early March, Lululemon entered the footwear category with four new women's styles set to debut in 2022.
In mid-January, BTIG analyst indicated that traffic at stores has already started rebounding; the company estimated 4Q21 net revenue to be toward the low end of its range of $2.125B to $2.165B compared to consensus of $2.17B.
"We started the holiday season in a strong position but have since experienced several consequences of the omicron variant, including increased capacity constraints, more-limited staff availability, and reduced operating hours in certain locations," CEO Calvin McDonald commented.
SA Contributor Alex Ponte believes that it is not the time to be taking a position; SA Author's Average rating stands at Buy.
In the past 6-months, the company's stock price eroded 24.6% of its value.
Out of 31 Wall Street Analysts covering the stock, while 14 have a Strong Buy rating 11 of them have a Hold rating and 4 have a Buy rating.