Analysts Respond To Sharp Decline Of Lululemon Shares

Lululemon (NASDAQ: LULU) Thursday morning reported its fiscal 2014 first quarter results.

Despite beating guidance and announcing a $450 million buyback plan, the company's shares are trading down over 15 percent.

Following the release of Lululemon's earnings results, a number of analysts have weighed in on the company's outlook.

D.A. Davidson: Buy, $46 price target

The analysts over at D.A. Davidson remain optimistic on Lulu's ability to drive sales and generate solid margins. The firm cautioned, however, that the lowered guidance and comments made on the conference call suggest that a turnaround is more likely to occur somewhere in the second half of 2015 or possibly in 2016.

Based on these items, the firm has "significantly" lowered its 2015 estimates.

The team noted that they do not believe the current share price reflects the long-term potential.

Topeka: Buy, $55 price target

The team at Topeka has lowered its price target from $70 to $55 due to lower guidance for 2014, but wrote, "We remain believers in the Lulu brand."

Driving this belief is the company's new CEO, as well as its new digital marketing and traffic driving efforts.

Citi: Neutral, $40 price target

Citigroup has taken a more cautious view of Lulu's shares and, as such, has downgraded the company from Buy to Neutral and lowered the price target from $61 to $40.

The team at Citi cited transition risk, timing of new management impact, competitive and customer response cautions, and the ramp up in EPS as reasons for the reduction in price target.