Do These Clothing Retailers Have More Upside? Lululemon Athletica inc.(LULU), Gap Inc(GPS) and Banjo & Matilda(BANJ)
New York, NY – GDP INSIDER – 02/11/2015.
This article discusses three companies: Lululemon Athletica inc.(NASDAQ:LULU), Gap Inc(NYSE:GPS) and Banjo & Matilda(OTCMKTS:BANJ)
Lululemon Athletica inc.(NASDAQ:LULU) is well positioned for growth and to benefit from an improving retail environment. The founder has left Lululemon in good shape and has repaired the brand’s image. The stock is up 36% over the past 52 weeks while the S&P 500 is up 13.7%. Since its bottom in mid-October, Lululemon is up 67% and is maintaining strong momentum so far in 2015. The RSI hit 85 in late January, indicating that it might have risen in value too quickly. Since then the RSI has retreated to 66.8 with the stock price remaining relatively flat.
Gap Inc(NYSE:GPS) has performed well over the past three months like many retailers. The stock is up 5.8% compared to the S&P 500 that is up 1.5% over the same period. However, Gap Inc had some volatility over the past year trading from $35.46 – $46.85. Gap brands cover the full spectrum of the apparel market, from discount stores like Old Navy up to more premium brands like Banana Republic. The surge in retail spending many expect in 2015 should drive earnings and the share price higher. The forward P/E of 13.5x FY16 earnings leaves room for upside.
Banjo & Matilda(OTCMKTS:BANJ) reported strong December numbers earlier this month. The Australian company is successfully increasing the number of its retailers. This has led to improved sales and a more optimistic outlook. The company was in just 18 retail outlets a year ago and reported that increased to over 200 in December. The premium lifestyle brand can continue to increase its retail presence and raise awareness among consumers. The shares sold off over the past year, but have stabilized since the latest earnings announcement and could start to rebound.
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