Lululemon is nearing a peak: Instinet

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With Lululemon Athletica Inc.’s investor day scheduled for April 24, Instinet analysts question the company’s remaining capacity for growth. “Lululemon’s clearly one of the strongest retail growth stories,” wrote analysts led by Simeon Siegel. “However, it seems either sales or margins are approaching a peak.” Analysts think Lululemon is “more a high-margin retailer than athletic brand,” forecasting that the brand will guide for sales of $6.5 billion as part of its five-year plan. “[W]e worry Lululemon is now at the point where sales growth will likely come at the expense of margins,” analysts said. Instinet rates Lululemon shares neutral with a $157. Lululemon stock has rallied more than 39% for 2019 so far, outpacing the S&P 500 index , which is up nearly 16% for the period.Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.