Lululemon Stock (LULU) Dips Ahead Of Earnings As Street Expects Narrowing EPS

Lululemon's stock price (NASDAQ: LULU) is currently set at $185.09, a decrease of $2.53 or 1.35% as it approaches its Q3 FY2025 earnings report.

The consensus EPS estimate for the quarter is $2.21, a decline when compared to the $2.87 reported this time last year. Revenue is expected to come in at $2.48 billion, for a 3.42% sales growth rate.

Technically speaking, the stock price is flashing some mixed signals, sitting above its 50-day SMA of $172.87, suggesting potential short-term bullish momentum. However, it remains significantly below its 200-day SMA of $236.37. This positioning below the 200-day SMA signals a longer-term bearish trend, indicating that the stock has struggled to maintain upward momentum over an extended period, which is clearly reflected in the chart above.

Lululemon's stock is 50% lower than where it began 2025, with bearish sentiment proving hard to shake. With a declining EPS, and very modest sales growth expected, the story at LULU has shifted.

Options market data reveals an implied volatility of 67.01% for Lululemon, indicating a high degree of uncertainty surrounding the stock's near-term movements. The options market anticipates a potential price swing of approximately $19.13, translating to a possible fluctuation of ±10.19% in either direction.

Lululemon's ability to navigate the evolving retail landscape will be critical to its long-term success. The company faces increasing competition from established players and emerging brands, all vying for a share of the athletic apparel market. Adapting to changing consumer preferences, embracing digital innovation, and maintaining a strong brand identity will be essential for Lululemon to sustain its growth trajectory.

The stock's performance post-earnings announcement will likely hinge on the interplay between the reported financial results, management's guidance, and overall market sentiment. A combination of positive earnings surprises, optimistic guidance, and favorable market conditions could propel the stock higher. Conversely, disappointing results, cautious guidance, and a negative market environment could trigger a move back towards 52 week lows.