What The Sell/Buy Ratio Is Telling About Lululemon Athletica Inc. (LULU)?

At Lululemon Athletica Inc. (NASDAQ:LULU), the ratio of insider selling to insider buying over a quarter is running at 0. Could this be a sign something is cheering insiders? LULU recorded 0 sales count on the open market in the last three months. They sold nearly zero shares while purchases amounted to 256 shares that period. Looking even further back to 12 months, corporate insiders offloaded 32,775,573 shares when buyers snapped up 31,541 shares. The 12-month’s totals signify about a 1039.14-to-1 sell/buy ratio.

Mussafer David M parted with a total of 17.94 thousand shares of Lululemon Athletica Inc. (LULU) at average share price of $121. This insider trade in the company took place on 06/07/2018. The total for the sales was set at $2.17 million. After this transaction, the Director account balance stood at 36.33 thousand shares. The stock grew 10.43 percent since that insider sale. On 06/07/2018, Advent International Corp/Ma, 10% Owner, sold 10 million shares at a price per share of $121. This removed 1210 million shares from the insider’s fortune and the stock saw a 10.43 percent rally in value since the news became public. This transaction left 10.11 million shares in the 10% Owner account.

On 06/07/2018, 10% Owner Advent International Corp/Ma performed a sale transaction worth $1210 million. This sale at $121 each has eliminated 10 million shares from the insider’s portfolio position. Meanwhile, shares have recorded 10.43 percent increase since the transaction was reported. The insider now is left with 10.11 million shares remaining in the account. Advent International Corp/Ma, who performs the 10% Owner job, sold 10 million shares for $1210 million. The disposal occurred on 06/07/2018 was priced at $121 per share. The share price soared 10.43 percent since the reporting date. Advent International Corp/Ma now left with a stake of 10.11 million LULU stock worth $1328.24 million after the insider selling.

The 12-month median price target for Lululemon Athletica Inc. (LULU) assigned by the analysts stands at $164, which represents a return potential of 24.77 percent when compared to the closing price of the stock of $131.44 on Thursday, December 06. The lowest price target for the stock is $75 — slightly more than -42.94 percent from LULU’s current share price. The stock will probably climb 24.12 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $200-month high price target. This represents a whopping 52.16 percent increase from where shares are trading today.

On momentum oscillators front, ‘RSI’ has touched 46.26 on daily chart, which may remain a cause for concern. If the price breaks below $122.75 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $135.25 mark may result into a pull-back move towards $139.05 level. The stock is currently hovering around the first support level of $127.1. Below this, the next support is placed in the zone of $122.75. Till the time, the LULU stock trades above this level, bulls have nothing to fear.

Shares of Lululemon Athletica Inc. (LULU) are trading at a P/E ratio of 40.67 times earnings reported for the past 12 months. The industry LULU operates in has an average P/E of 40.11. Its P/E ratio went as low as 23.87X and as high as 39.99 over the 5-year span. Further, it is sporting a 5.82 on the Price-to-Sales ratio. Compare this with the industry average P/S of 6.48. 54.3 percent is the gross profit margin for Lululemon Athletica Inc. and operating margin sits at 19.9 percent. Along with this, the net profit margin is 12 percent.

On 6th of December, Lululemon Athletica Inc. (NASDAQ:LULU) shares ended lower after a volatile session. The shares dropped -2.18 points or -1.63 percent at $131.44 with a heavy trade volume of 5.316 million shares. After opening the session at $133, the shares went as high as $134.71 and as low as $126.5576, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $17 billion and now has 129.29 million shares outstanding. Lululemon Athletica Inc. (LULU) stock has lost -7.57 percent of market value in 21 trading days.

In last reported earnings results, LULU earned $0.71 per share, better than the $0.49, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $724M, better than the $668M analysts expected. Earnings are estimated to increase by 5.7 percent this year, 18.13 percent next year and continue to increase by 24.06 percent annually for the next 5 years. Analysts are forecasting revenue to climb 19.1 percent to $737M in the next fiscal quarter, while earnings are seen soaring by nearly 25 percent to $0.7 per share. History has shown that shares in Lululemon Athletica Inc. have gone up on 25 different earnings reaction days and are predicted to add 0.08 percent when the company reports upcoming earnings.

LULU stock has a trailing 3-year beta of 0.38, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $3.02 a share in the trailing twelve months. The stock’s value has surged 67.25 percent year to date (YTD) against a rise of 98.07 percent in 12 month’s time. The company’s shares still trade -20.24 percent away from its 1-year high of $164.79 and 101.29 percent up from 52-week low of $65.30. The average consensus rating on the company is 2.1, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a sell.