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Is this Large Market Cap Stock target price reasonable for Lululemon Athletica Inc. (NASDAQ:LULU)?

The company in question is, Lululemon Athletica Inc. (NASDAQ:LULU) currently with a stock price of 79.91 (1.74% today). The market cap for Lululemon Athletica Inc. is 10809.46, and is in the sector Consumer Goods, and Textile – Apparel Clothing industry. The target price for Lululemon Athletica Inc. is 72.5. Currently Lululemon Athletica Inc. is trading with a P/E of 41.45, and a forward P/E of 30.99. Average volume for Lululemon Athletica Inc. is 1808.95 and so far today it is 649895.

Performance in the last year for Lululemon Athletica Inc. has been 17.75%. For EPS growth, Lululemon Athletica Inc. has seen a growth of 14.20%, and is looking to grow in the next year to 18.14%. More long term stats show that EPS growth has been 17.40% over the last five years and could be 16.20% for the next five years. Lululemon Athletica Inc. has seen sales growth quarter over quarter at 17.00%, with EPS growth quarter over quarter at -1.80%. The 20-day simple moving average is 6.26%, with the 200-day simple moving average coming to 27.31%.

Since the IPO date for Lululemon Athletica Inc. on the 7/27/2007, Lululemon Athletica Inc. has seen performance year to date to be 49.69%. With Lululemon Athletica Inc. trading at 79.91, the dividend yield is *TBA, and the EPS is 1.9.

So could Lululemon Athletica Inc., be undervalued? Well as said before P/E is 41.45. The PEG is 2.56, P/S is 5.07 and the P/B is at 9.49. The P/cash is 19.65, with P/free cash flow at 61.66.

Lululemon Athletica Inc. ability to deal with debt shows that the current ratio is 4.8, and the quick ratio is 3.4. This is with long term debt/equity at 0, and total debt/equity at 0.

In terms of margins, Lululemon Athletica Inc. has a gross margin of 48.30%, an operating margin of 16.80% and a profit margin of 12.40%.Payout ratio for Lululemon Athletica Inc. is 0.00%. Return on assets come to 19.80% with return on investment coming to 25.90%.

Insider ownership for Lululemon Athletica Inc., is at 0.20% and institutional ownership comes to 100.00%. Outstanding shares are at 137.63. While shares float is 106.73. The float short is currently 16.67%, and short ratio is 9.83.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.

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Tony Dabbs

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