The first by CFRA, the latter by BNP Paribas. Pretty crazy how far apart they are. Basically one is saying the company will recover and the other that it will go broke. I might become an analyst too and just say random things.
CFRA: The brand is temporarily broken, but the underlying franchise is still extremely valuable. New management fixes product/fit issues, restores innovation, stabilizes U.S. demand, and margins eventually normalize. The market is pricing in a cyclical/operational recovery. Still has about $1.4 billion in cash.
BNP: The brand's competitive moat has materially deteriorated. Alo and Vuori continue taking share, core women's bottoms remain weak, pricing power erodes, and the company has to spend heavily to win customers back. In that scenario, the old earnings/multiple framework is simply the wrong anchor. LULU's latest results showed core leggings down 20% in Q2, while management cut its outlook. LULU's athleisure market share has fallen by 10 percentage points as Alo and Vuori gained ground.
The rest of Wall Street: clustered between BNP and CFRA and playing it safe with their price targets around $90-$110.