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Tag: lululemon

  • Lululemon Shares Fall After Analyst Criticizes Company’s Lack Of Strategy

    Lululemon shares took a beating today after a Sterne analyst said the company didn’t provide an effective plan for growth. The company’s share price was down 2.64 points before trading ended today, but the price has risen 0.06 points in after hours trading. While a falling share price is certainly trouble, this isn’t the first time that the athletic wear company has been in hot water this year.

    Back in March, Lululemon announced that it was recalling a number of its popular black Luon yoga pants. The company said that the affected pants were affected by a lack of coverage that left the sheerness at a level the company said fell short of its “very high standards.” After the recall began, some customers reported that they were asked to wear their yoga pants in front of employees to prove that they were of inferior quality and shareholders even sued the company claiming that it should have properly tested the yoga pants before shipping them to stores. The lawsuit was dismissed earlier this month.

    So, why did Lululemon’s share price take a hit? It would appear that the company finally has all its ducks in a row after all. As it turns out, the company isn’t impressing shareholders and analysts anymore now than it was earlier this month. Sam Poser, an analyst with Sterne Agee & Leach, Inc., says the company “did not provide any updates on its long-short-term financial objectives.” He also added that the company “did not address in specific terms plans to reengage with the customer at the store level and reignite new customer acquisition.” In the end, Sterne rated the company “underperform.”

    Other players on Wall Street have been skeptical of the company as well. The Street rated Lululemon’s shares as a Hold and said that it could neither justify a positive or negative rating relative to other stocks. It says that the company has shown solid revenue growth, but warns that its stock performance over the last year has been “generally disappointing.”

    So, what does Poser say the company needs to do to turn things around? It’s really quite simple:

    “A detailed constructive strategy, beyond the improved product, not just words, is needed to rebuild the aspirational quality of the Lululemon brand,” Poser wrote. “Most of those who do not see the brand as damaged are loyal Lululemon customers, but new customers are needed for the long-term success of both the company and the stock.”

    Maybe the company should heed the advice it gave to its fans on Friday:

    [h/t: Bloomberg]
    Image via lululemon/YouTube

  • Lululemon Lawsuit: Athletic Clothier Catches A Break

    Lululemon Athletica has suffered a lot of bad press over the past year. Scarcely over a year ago, complaints started cropping up about the quality of their black Luon yoga pants. Namely, the pants became embarrassingly sheer when worn.

    The company issued a recall. Unfortunately, to return the pants, some customers reported being asked to put their pair on and bend over in front of Lululemon employees to demonstrate the material’s sheerness. Consumers balked at the humiliation.

    Amid the recall crisis, founder Chip Wilson only dug the company in deeper. In an interview with Bloomberg, Wilson blamed the sheerness and pilling on “the rubbing through the thighs” and said “sometimes this material does not work for certain people’s bodies.” Customers were offended by the implication.

    Some unsavory info about Wilson supporting child labor and finding amusement in Japanese people trying to pronounce “Lululemon” also surfaced, adding extra fuel to the fire.

    Lululemon was having a public image crisis that would quickly affect their profits to the tune of two billion dollars. Company shareholders filed a lawsuit against Lululemon in 2013. They charged that Lululemon misrepresented the quality of its products by hiding defects in the Luon material, costing the company millions in inferior yoga pants. Investors claimed that if the product had been properly tested on real people before mass production and distribution, the recall would never have happened.

    Luckily for Lululemon, that lawsuit was dismissed Friday, according to Reuters. U.S. District Judge Katherine Forrest reasoned that “if Lululemon secretly knew that the (alleged) fix for its quality issues was simply to employ more people to wear its yoga pants and exercise, it would have done so-rather than the alternative of losing two billion in market capitalization.” Although Judge Forrest is still reviewing shareholders’ objections, she said she was not inclined to change her mind on the matter.

    In other news, Wilson is leaving his non-executive chairman position and Laurent Potdevin is replacing Christine Day as chief executive officer. Vindicated and under new leadership, it looks like Lululemon might have a chance to turn its luck around in 2014.

    Image via Wikimedia Commons

  • Sundresses and Pants By Lululemon: Worth the Cost?

    Sundresses and tank tops are just about ready to be in season for spring and summer, and yoga gear maker Lululemon has jumped on the bandwagon this year, according to Yahoo Finance.

    The workout fashion giant has launched a new line of activewear for women on the go called, appropriately, &Go. The line features sundresses, tank tops, and summer pants that you can wear anywhere. You know, because you really shouldn’t wear yoga pants everywhere. Really.

    The new line boasts a wardrobe for women who are “out the door at daybreak and moving until midnight.” So, they are talking about clothes they say you can wear from the gym to happy hour.

    They say that, “You don’t have time for a wardrobe that keeps forcing you to change.” and, “You’re busy living. We get it.”

    Well, some might say that they don’t get it. Some might say that their clothes, made almost exclusively with cheap materials, are over-priced for what they are.

    The line’s shorts are going for $54, tops for $58, dresses for $198 and pants cost between $108 and $118.

    However, on the flip side, there are many who are totally ok with paying $58 for a shirt. Perhaps for the brand name? Who knows. But, the company has done quite well so far with the new line, so they must be doing something right.

    After all, six of the 12 items that were debuted on Tuesday sold out in a matter of hours! This kind of success is happening in the company during a somewhat turbulent time for them.

    “In our opinion, it is the most progressive, fashion-forward line the company has brought to market in quite some time,” Canaccord Genuity analyst Camilo Lyon said on Tuesday. “We believe the strong reception to &Go could turn investor sentiment positive after months of deserved pessimism given the company’s underperformance and mis-execution.”

    What do you think? Quality items that are worth the cost? Or over-priced workout wear from a company that has convinced an entire nation of women that it’s totally acceptable to pay top dollar for yoga gear?

    Image via Lululemon.com

  • Lululemon Founder Blames Women for See-Through Yoga Pants Problem

    Lululemon Founder Blames Women for See-Through Yoga Pants Problem

    Remember the yoga pants by Lululemon that were recalled earlier this year because of the slight issue of them becoming see-through? Lululemon founder Chip Wilson found himself in hot water last week after he blamed women for the problem with his yoga pants. People were outraged with his comments, no surprise there, and Wilson has since issued an apology via YouTube and Twitter.

    Lululemon issued a recall back in March of this year on 17 percent of its black yoga pants after receiving complaints that the material was too thin, which made them see-through during workouts. Women who owned the defective pants, which cost anywhere from $72 to $98 retail, were given full refunds or replacements. At the time, Lululemon blamed the problem on receiving a defective batch, but a few days ago, founder Chip Wilson told Bloomberg the issue was really with the women who wore the pants.

    While Wilson admitted there was a problem with the design of the pants, he said the issue was more about the type of women who tried to wear the pants. “The thing is that women will wear seatbelts that don’t work [with the pants], or they’ll wear a purse that doesn’t work, or quite frankly some women’s bodies just actually don’t work for it,” Wilson said. “It’s really about the rubbing through the thighs, how much pressure is there over a period of time and how much they use it.”

    Let’s just say that women in general were less than pleased with Wilson’s claim that a lack of “thigh gap” was causing the pants to be defective, rather than the material. Check out some of the ticked off comments women made on Twitter below.

    Wilson has since issued an apology for his comments via YouTube and Twitter. “I’m sad, I’m really sad,” Wilson says in the video. “I’m sad for the repercussions of my actions. I’m sad for the people of Lululemon who I care so much about, that have really had to face the brunt of my actions.” Check out his apology video below.

    Do you think Wilson’s comments were out of line, or are people just too easily offended these days? Respond below.

    [Image via YouTube]