Nike’s valuation provides a map for Lululemon’s future, Cowen says


Lululemon is beginning to look like Nike, Cowen said on Tuesday as it raised its price target on the stock to $250.

The firm said Nike’s valuation provides a map for Lululemon’s future, and that when applying Nike’s multiple to Lululemon’s financial metrics and growth opportunities, there’s a path toward a $40 billion market cap, a $300-plus stock price and $1 billion in annual free cash flow.

Lululemon’s market cap is currently $29 billion, while Nike’s is $146 billion.

“Assuming LULU can sustain a NKE-like free cash flow multiple — we see a path to a $40B market cap. We view LULU growth, durability and ROIC profile as most similar to NKE,” the firm’s analysts lead by John Kernan said in…


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