lululemon athletica inc.·Industrials
Great business, but priced for perfection.
76/100B
Price at last run$112as of Jul 8, 2026
quality large-capConviction
none
No conviction — the council would not put money behind this at today's price.
High returns on capitalROIC ~43% — it earns well on the money it puts to work.
Fat operating margins20% operating margin — pricing power / a real moat hint.
Generates real cash7.4% free-cash-flow yield — profits you can actually bank.
Catalystnone yet
✕Why not
The honest case against — what most tools hideMain riskno obvious red flag
Demanding valuationRuns 47% above our patience price.
Falling knifeDown 53% from its 1-year high — momentum is against it.
What keeps us out
- Paying up here — we'd want a better entry price.
- Growth slowing while the multiple stays rich.
Patience price & distance
as of Jul 8, 2026 runGets interesting at
≈$78
−30% from today's $112
The patience price is where value discipline would let the council in — deliberately strict: we'd rather miss ten winners than own one loser.
The price currently runs 47% above our patience price. A target is an estimate, not a promise — markets can stay wrong for a long time, and the estimate can be wrong too.
Margin of safety by scenario
Bear
-72%
if things go wrong
Bull
-36%
if things go right
Each column is the discount to that scenario's fair value. The bear column is the one that matters most — a wide bear-case cushion is what lets the council own a name through a bad year.
Catalyst
none yet
A catalyst is a plausible reason the gap could close — never a certainty.