Should Investors Be Afraid of Lululemon?


While many investors have been excited about the incredible growth lululemon athletica has experienced, in this video, Motley Fool analyst Austin Smith offers some words of caution. He tells us that because the company is so closely tied to fashion and the yoga fitness trend going on at the moment, and these can be very fickle industries to be attached to, paying for Lululemon at its current lofty valuation to get into a fickle industry is a decision investors should examine closely. Austin also discusses some potential disruptors to Lululemon, and gives us one company he would rather invest in in the retail space.

Lululemon has been a pick of Motley Fool superinvestor David Gardner, and has soared more than 100% since he recommended it in December 2010. David specializes in identifying game-changing companies like this long before others are keen to their disruptive potential, and he helps like-minded investors profit while Wall Street catches up. I invite you to learn more about how he picks his winners with a free, personal tour of his flagship service: Supernova. Inside, you'll discover the science behind his market-trouncing returns. Just click here now for instant access.

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Austin Smith owns shares of The Buckle. Eric Bleeker has no position in any stocks mentioned. The Motley Fool recommends lululemon athletica, Nike, The Buckle, and Under Armour. The Motley Fool owns shares of Nike, The Buckle, and Under Armour. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Originally published