BofA Securities lowered its price target on Lululemon Athletica Inc. (NASDAQ:LULU) to $300 from $370 while maintaining a Buy rating, saying the stock’s recent selloff created an attractive entry point despite macro pressures.
The brokerage noted Lululemon traded at less than 12x forward P/E (F26E), its lowest-ever valuation, suggesting the market anticipated a significant earnings cut. BofA said if the company delivered on its 2Q sales growth of 7%–8% and maintained similar momentum in the second half, the stock could re-rate higher.
The revised $300 price target was based on 20x P/E, compared with the prior 14x EV/EBITDA, in line with valuation methods used for other growth stocks. The firm said the adjustment reflected the tougher macroeconomic environment but did not alter its long-term bullish stance on the brand.
