moosebump

Lululemon Makes Other Hot Clothing IPOs Look Cheap

Jim - you might end up being right but the current price is certainly pricing in optimistic projections (like yours).

A few of elements of your projections don't agree with what management is saying themselves:

1. Your 700 Intl plus 300 NA stores = 1000 or 950 more than today. Over 8 years to 2015 thats 119/year. But they are expecting to do 'just' 25 this year and up to 35 next. Their store opening process is fairly time and effort intensive as they put more effort into training staff and becoming active in the local fitness community. How well does that scale? I think its poses some risk now at 25 - 35 stores a year since they have only ever done 14 in a single year before now.

2. They have also said they would go international via JV so not all Int'l expansion would accrue to lulu shareholders.

3. They are targeting a 20% operating margin so after 35% tax that is more like 13% net. So even on 2.5B, your profit is $325.