Morgan Stanley: Cuts Lululemon target price from $280.00 to $223.00.

Morgan Stanley: Cuts Lululemon target price from $280.00 to $223.00.

July 02, 2025 - Morgan Stanley has reduced its price target for Lululemon Athletica Inc. (NASDAQ: LULU) from $280.00 to $223.00, while maintaining an Equalweight rating on the stock. This move comes amidst ongoing concerns about the company's sales performance in the Americas and the potential need to revise fiscal year profitability guidance [2].

The firm cited continued concerns about the lack of a positive Americas comparable sales inflection, which it believes is unlikely to materialize in the second quarter of fiscal 2025. Morgan Stanley also indicated that Lululemon’s current valuation of approximately 14x forward price-to-earnings ratio appears "overly punitive," but suggested that re-rating is unlikely without improvement in Americas sales performance [2].

Despite these concerns, Morgan Stanley maintained that the risk-reward for Lululemon still skews to the upside over the next twelve months, based on the stock’s current valuation and potential for improvement in Americas sales trends [2].

Lululemon Athletica recently reported a 7% increase in total revenue for the first quarter of 2025, reaching $2.4 billion. Despite facing tariff challenges, the company’s net income rose to $315 million, translating to $2.60 per diluted share. These financial results underscore Lululemon’s steady growth amid external pressures [2].

References:
1. [https://finance.yahoo.com/news/ubs-slashes-lululemon-athletica-inc-062021980.html](https://finance.yahoo.com/news/ubs-slashes-lululemon-athletica-inc-062021980.html)
2. [https://www.investing.com/news/analyst-ratings/lululemon-stock-price-target-lowered-to-223-by-morgan-stanley-93CH-4210197](https://www.investing.com/news/analyst-ratings/lululemon-stock-price-target-lowered-to-223-by-morgan-stanley-93CH-4210197)