LULU Stock Inches Higher After COO Departure

The firm is slated to report its third-quarter earnings after the close tomorrow

Deputy Editor
Dec 10, 2019 at 9:31 AM
facebook twitter linkedin


It was announced yesterday evening that the chief operating officer (COO) of athleisure company Lululemon Athletica Inc (NASDAQ:LULU), Stuart Haselden, will be leaving the firm to join privately owned luggage maker Away as its CEO, effective Jan. 10. The stock is up 0.7% at $232.50, at last check.

This announcement comes just ahead of LULU's third-quarter earnings report, scheduled for after the close tomorrow, and analysts are already chiming in, which may be buoying the security this morning. So far, Wedbush lifted its price target to $225 from $190. This puts the consensus 12-month target price right in line with current levels, which could invite even more analyst notes in the coming days. And while 12 of those in coverage consider the yoga pants manufacturer to be a "strong buy," 10 have slapped it with a tepid "hold" rating. 

Historically, earnings season has been a boon for LULU, with seven of its last eight post-earnings sessions yielding positive returns, including a 14.1% pop in March, and a 16.3% surge in June 2018. The security has averaged a next-day swing of 10.3%, regardless of direction, and this time around the options pits are pricing in a post-earnings move of 12.4%. 

Speaking of the options pits, things have rarely been more call-heavy than they are right now. In fact, 1.7 long calls have been bought for every put on the  International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) -- a ratio that sits higher than 98% of all other readings from the past year. 

This isn't surprising considering LULU's recent charge higher. The security has already added 90% for the year, and just came off an all-time high of $233.53 yesterday, with some help from the ascending 10-day moving average. The shares have been consolidating just south of this level for the week, but are hurtling toward their best year on record. 

 

If you are not making money with options, you aren’t buying options like this…

There is no options strategy that more perfectly approaches trading the fastest moving and most volatile stocks available in the marketplace than this one. In fact, there is no strategy that better utilizes put options for optimal returns and a real trading edge over other traders in the exact same market. New options traders fail out at an incredible rate without proper trade research, execution timing, and option picking. Capitalize on Schaeffer’s 100+ years of options trading excellence with the most coveted product launch in company history. Don't waste another second... join us right now before the next round of trades are released!

Schaeffer's Investment Research Master Portfolio Trial
 


 


 
Special Offers from Schaeffer's Trading Partners