Thomson Reuters
- Lululemon plans to reach $1 billion in international sales by 2020.
- Analysts at Oppenheimer believe that company is well on its way to getting there thanks to its strong fundamentals.
- Although former CEO and chairman Laurent Potdevin abruptly resigned over allegations of fostering a "toxic" work culture in February, the analysts believe that the company's fundamentals are still strong.
- You can view Lululemon's stock price in real time here.
Lululemon has set its sights on reaching $1 billion in international sales by 2020, and its well on its way to getting there, analysts at Oppenheimer say.
According to its third-quarter results, the athleisure retailer's sales in Asia doubled in the third quarter, while in Europe they were up 40%. The company reported total quarterly sales of $619 million, up 14% from the same quarter last year, and sales for the first three quarters ended October 29 was $1.72 billion.
That "long international runway," could help reach the $1 billion target, Oppenheimer analysts Anna Andreeva and Samantha Lanman wrote in a note to clients.
Online penetration in China alone is expected to grow 40% to 50% by 2020, the analysts said. This should offset slower sales growth in Europe. The company's ambitious 2020 sales target is part of a larger plan to grow the company's total sales to $4 billion. Lululemon expects $1 billion of that figure to come from international sales, $1 billion from online sales, and another $1 billion in sales of men's apparel, its former CEO and chairman Laurent Potdevin said in an investor call in December.
Although Potdevin abruptly resigned over allegations of fostering a "toxic" work culture, the analysts believe that the company's fundamentals are still strong.
They raised their price to $88 per share, from $75, and gave the company an "Outperform" rating.
Lululemon's stock was trading at $79.50 per share on Friday, unchanged for the year. The company is expected to report fourth-quarter 2017 earnings results on March 27.
You can view Market Insider's earnings calender here.
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