Lululemon's Stock Tumbles As Volume Spikes After Profit Outlook Cut

By Tomi KilgoreMarketWatch Pulse

Lululemon Athletica Inc.'s stock tumbled 13% in very active afternoon trade Wednesday, in the wake of fiscal third-quarter results, and a lowered outlook for the current quarter. That put the stock on track for the biggest percentage loss since Sept. 10, when it plunged 16% after second-quarter results. With about an hour left in the session, volume was 17.4 million shares, or about five times the full-day average of 3.4 million shares, according to FactSet. Analyst Andrew Burns of D.A. Davidson & Co. kept his rating at neutral, but cut his stock price target to $53 from $57. He said the lowered fourth-quarter guidance "dents confidence just as operational advances commence." That suggests the inflection point for year-over-year sales and earnings improvements is still a few quarters away. The stock has plummeted 29% over the past three months, while the S&P 500 has gained 5.2%.

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