HONG KONG, CHINA – 2021/04/06: Canadian sportswear clothing band, Lululemon logo and store seen in … [+]
What?
Lululemon (NASDAQ:LULU) Direct to Consumer Revenues doubled from $1.14 billion in 2019 to $2.28 billion in 2020 and Trefis expects the number to grow incrementally to $2.51 billion in 2021.
Why?
Lululemon benefited from the demand for comfortable work-from-home clothing through Covid-19. Moreover, customers increasingly placed orders via e-commerce channels, helping Direct To Customer revenues. However, DTC sales growth is likely to moderate in 2021 as retail stores continue re-open post-Covid-19 lockdowns.
So What?
The DTC segment has higher operating margins compared to the company’s retail business and as the online business grows, it could bode well for Lululemon’s profitability.
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While we think Lululemon stock looks undervalued, it is helpful to know how its peers stack up. Lululemon Stock Comparison With Peers summarizes how Lululemon compares against peers on metrics that matter. You can find more useful comparisons on Peer Comparisons.
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