lululemon athletica inc. (LULU) Isn't Doing Great Right Now, Says Jim Cramer
lululemon athletica inc. (NASDAQ:LULU) is a Canadian fitness apparel company whose shares have been caught in the midst of a broader weakness in the retail market. The shares are down by 37% year-to-date on the back of a particularly vicious 19.8% dip in June. lululemon athletica inc. (NASDAQ:LULU)'s shares sank after management revealed that it might have to increase prices and absorb the impacts of tariffs on its income statement. In his earlier remarks about lululemon athletica inc. (NASDAQ:LULU), Cramer has wondered whether he misjudged the firm's competition. This time around he mentioned the stock as an afterthought in the sectors that aren't doing well right now:
'Remember, it's certain, I'm saying, housing, that's not great. Housing, auto, and Lulu.'
A store employee in an athletic apparel store restocking merchandise.
Cramer discussed lululemon athletica inc. (NASDAQ:LULU) in detail after the disastrous earnings report. Here is what he said:
'I thought that LULU would do better. I thought that LULU would do better. I was quite surprised. I just, it was a bad conference call. It was a bad quarter. I am aghast to think that this could be… such a horrible situation. They had tariff problems. They had the wrong fashion. Everything went wrong for Calvin McDonald, and what can I say? I just don't think he's capable of being as bad as that stock was, 17 times earnings. It was a bad quarter, though. And you know… I've thought a lot about this, done a lot of soul searching, I am shocked at how they missed the quarter, and I wouldn't be surprised if there weren't some shakeups if that happened again.'
While we acknowledge the potential of LULU as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
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