Mostly Borrowed Ideas Deep Dives, MBI Deep Dives

MBI Deep Dives

Mostly Borrowed Ideas Deep Dives

MBI is the abbreviation for “Mostly Borrowed Ideas”. Why “Mostly Borrowed Ideas?” As a generalist, I do not have a background in any particular sector. I enjoy navigating across industries, businesses, and countries to learn, understand, and connect the dots. In any case, most ideas and innovations are incremental in nature. Very few of us are smart enough to come up with truly original or groundbreaking ideas. I am Abdullah Al-Rezwan. I was born and brought up in Bangladesh. I went to University of Dhaka for my undergrad and majored in Finance. After working three and half years in Equity Research (Sell-side) covering Financial Sector in Bangladesh, I left Bangladesh to pursue my MBA in the US. I graduated within top 10% of the class from Cornell University's two-year MBA program and worked on the buy-side following my graduation. During my time at Cornell, I won two stock pitch competitions and also became finalists in four other competitions. I thoroughly enjoyed my stint as a generalist in the US large cap team at Madison Investments and covered a wide range of companies from UnitedHealth to Amazon and Boeing before US immigration reality paused my career in investment management. As my work authorization expired, I moved to Canada in January, 2021. Then in early 2022, I was able to return to the US.

Equity Bottom-Up

<ul><li>Lulu is again back to LSD growth in the US; what makes it more disappointing is they actually had a somewhat easier comparison since 1Q’24 growth was just 2%.</li><li>Canada, despite a low double digit growth in 1Q’24, again had higher growth than the US this quarter.</li><li>China and Rest of the World (RoW) maintained healthy growth rates but growth has materially decelerated. </li></ul>

Lulu is again back to LSD growth in the US; what makes it more disappointing is they actually had a somewhat easier comparison since 1Q’24 growth was just 2%.Canada, despite a low double digit growth in 1Q’24, again had higher growth than the US this quarter.China and Rest of the World (RoW) maintained healthy growth rates but growth has materially decelerated. 

<ul><li>Since its IPO back in 2007, Lululemon always posted double-digit revenue growth every single year.</li><li>While there was plenty of skepticism throughout 2024, they managed to eke out double digit growth last year.</li><li>But 2025 topline guidance of 5-7% implies the era of persistent double digit growth regardless of the economy is likely behind us!</li></ul>

Since its IPO back in 2007, Lululemon always posted double-digit revenue growth every single year.While there was plenty of skepticism throughout 2024, they managed to eke out double digit growth last year.But 2025 topline guidance of 5-7% implies the era of persistent double digit growth regardless of the economy is likely behind us!

<ul><li>While the overall market continues to hit All-time High almost every other day, Lulu has been battling the skeptics for much of this year.</li><li>There is still a long way to go, but with the stock now up almost 50% over the last three months, Mr. Market has likely started acknowledging that the bear narratives perhaps went a bit too far.</li><li>Glancing through the numbers for 3Q’24 may seem eerily similar to 2Q’24, but management’s tone was much more upbeat in tonight.</li></ul>

While the overall market continues to hit All-time High almost every other day, Lulu has been battling the skeptics for much of this year.There is still a long way to go, but with the stock now up almost 50% over the last three months, Mr. Market has likely started acknowledging that the bear narratives perhaps went a bit too far.Glancing through the numbers for 3Q’24 may seem eerily similar to 2Q’24, but management’s tone was much more upbeat in tonight.

<ul><li>It is far from common for a stock to be up 4% after missing the revenue guide for the quarter and slashing the full-year revenue guide for the year.</li><li>That’s exactly what happened with Lululemon today which should tell you the kind of sentiment going into the earnings!</li><li>The crux of the bear thesis on Lulu usually circles around their US business. </li></ul>

It is far from common for a stock to be up 4% after missing the revenue guide for the quarter and slashing the full-year revenue guide for the year.That’s exactly what happened with Lululemon today which should tell you the kind of sentiment going into the earnings!The crux of the bear thesis on Lulu usually circles around their US business. 

External reports (aggregated public sources), Value Investors Club

Value Investors Club (VIC)

External reports (aggregated public sources)

Value Investors Club

<ul><li>Strong candidate for shorting in the short-run, potential to miss revenue consensus by 4-5ppt in Q1 2024</li><li>Recommendation to short LULU US when share price is above USD410, price target of USD300 before next earnings date in May 2024</li><li>Lululemon is a leading brand in women's indoor training and yoga, overvalued and likely to see a decline in share price</li></ul><p><em>This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.</em></p>

Strong candidate for shorting in the short-run, potential to miss revenue consensus by 4-5ppt in Q1 2024Recommendation to short LULU US when share price is above USD410, price target of USD300 before next earnings date in May 2024Lululemon is a leading brand in women's indoor training and yoga, overvalued and likely to see a decline in share priceThis content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

United States

lululemon athletica Inc. designs and retails athletic clothing.  The Company produces fitness pants, shorts, tops and jackets for yoga, dance, running, and general fitness. lululemon serves customers throughout the world.

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Lululemon Athletica (LULU US)

Lululemon 1Q'25 Update

Lulu is again back to LSD growth in the US; what makes it more disappointing is they actually had a somewhat easier comparison since 1Q’24 growth...

MBI Deep Dives

Lululemon 4Q'24 Update

Since its IPO back in 2007, Lululemon always posted double-digit revenue growth every single year. While there was plenty of skepticism throughout...

MBI Deep Dives

Lululemon 3Q'24 Update

While the overall market continues to hit All-time High almost every other day, Lulu has been battling the skeptics for much of this year.

MBI Deep Dives

Lululemon 2Q'24 Update

It is far from common for a stock to be up 4% after missing the revenue guide for the quarter and slashing the full-year revenue guide for the...

MBI Deep Dives

Lululemon (LULU) - Thursday, Apr 4, 2024

Recommendation to short LULU US when share price is above USD410, price target of USD300 before next earnings date in May 2024

Value Investors Club (VIC)

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