Lululemon (NASDAQ: LULU) announced Monday that it forecasts fourth quarter earnings and sales to reach the top end of its previous outlook, amid the strong holiday outcome. The company now anticipates its percentage growth will be on the high end of its previous expectations in comparison to the prior year.
The athletic apparel retailer has presented an update to the previously disclosed mid-single-digit expectations as the annual ICR Conference nears. Throughout the conference, Lululemon will take part in virtual meetings with analysts and investors. Furthermore, it said net revenue for the quarter ending January 31 is expected to skyrocket towards the higher end forecasts.
Despite the positive intention, Lululemon shares fell 3.2% upon the opening bell on Monday. However, the stock has surged over 54% in the last year.
According to BMO Capital Markets analyst Simeon Siegel, shares most likely fell because Wall Street anticipated the retailer would increase its outlook.
“Investors expected a beat, not a pause,” Siegel said. But most retailers are “only in the beginning of recovery,” he added.
Meanwhile, Chief Executive Calvin McDonald said the company is “pleased with the momentum over the holiday period as our investments in Lululemon and Mirror allowed us to connect with guests both physically and digitally.”
The retailer has yet to present an outlook for the full year amid the ongoing pandemic.