Lululemon Athletica Inc. (NASDAQ: LULU) has become one of retail’s biggest reset stories. After years of strong growth, the stock now trades near $176/share, down about 33% in the past year as demand cools and margins come under pressure. Concerns about competition and slowing momentum have fueled the decline. But with the valuation at multi-year lows and the brand still highly profitable, analysts remain divided on what comes next.
Recently, the company cut its full-year revenue and profit guidance, citing softer U.S. demand and tariff pressures, which triggered a sharp drop in the stock. At the same time, management is trying to refresh its appeal by increasing the share of new designs in its product lineup, aiming to keep customers engaged and fend off competition. These developments highlight the delicate balance between short-term headwinds and long-term brand strength.
This article explores where Wall Street analysts think Lululemon could trade by 2028. We have pulled together consensus targets, growth forecasts, and valuation models to outline the stock’s possible trajectory. These figures reflect current analyst expectations and are not TIKR’s own predictions.
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Analyst Price Targets Suggest Modest Upside
Lululemon trades at about $176/share today. The average analyst price target is $197/share, which suggests roughly 12% upside. Forecasts show a wide spread and highlight the uncertainty around the stock:
- High estimate: ~$303/share
- Low estimate: ~$100/share
- Median target: ~$185/share
- Ratings: mostly Holds, a few Buys
It looks like analysts see modest potential for gains, but the wide range of targets suggests conviction is low. For investors, the takeaway is that Wall Street expects stability more than a dramatic rebound, making LULU look like more of a cautious hold than a strong buy.
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Lululemon: Growth Outlook and Valuation
The company’s fundamentals point to slower but steady progress:
- Revenue is projected to grow ~4.8% annually through FY2028
- Operating margins are expected to ease to ~18.8%, down from highs above 22%
- Shares trade near 14x forward earnings, at the low end of historical valuations
- Based on analysts’ average estimates, TIKR’s Guided Valuation Model using a 14.3x forward P/E suggests ~$220/share by FY2028
- That implies about 25% upside, or roughly 10% annualized returns
These forecasts suggest Lululemon can still compound steadily, though at a slower pace than in the past. For investors, this means the stock now looks like a strong brand at a fair price, but the hyper-growth years appear behind it.
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What’s Driving the Optimism?
Lululemon remains one of the most profitable names in activewear, supported by strong pricing power and loyal customers. The company’s reputation for premium quality has helped it maintain industry-leading profitability even as growth has cooled.
Expansion into international markets, along with newer categories like men’s and footwear, gives the company room to grow. With healthy cash flow and a clean balance sheet, Lululemon has the resources to keep investing in product innovation and expansion.
For investors, the optimism is that Lululemon’s brand strength and financial discipline make it a dependable compounder, even if growth is less explosive than before.
Bear Case: Valuation and Competition
The biggest risk for Lululemon is rising competition. Rivals like Nike, Alo Yoga, and Vuori are fighting for share in the same premium segment, putting pressure on pricing power and customer loyalty.
At the same time, softer demand and higher costs could weigh on earnings. Investors worry that Lululemon is shifting from a growth story to a more mature brand, which could limit its valuation multiple over time.
For investors, the bear case is that even at 14x earnings, the stock may not look cheap if growth slows further, leaving room for another reset lower.
Outlook for 2028: What Could Lululemon Be Worth?
Based on analysts’ average estimates, TIKR’s Guided Valuation Model using a 14.3x forward P/E suggests Lululemon could trade near $220/share by 2028. That represents about 25% upside from today’s level, or roughly 10% annualized returns.
This outlook assumes modest revenue growth, some margin pressure, and valuation multiples holding steady. It paints a picture of stability rather than dramatic recovery.
For investors, this means Lululemon looks like a high-quality compounder that may deliver steady mid-range returns, while bigger gains would depend on stronger global growth or renewed brand momentum.
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