"While we could be early (depends on comp trajectory), Lululemon is one of the most controversial stocks in retail, and we believe brand equity remains intact," Oppenheimer wrote in a research note. "After self-inflicted [issues in] 2013, there should be levers to accelerate top- and bottom-line growth, driven by double-digit square footage growth, double-digit growth online and margin recovery over time."
(Read more: Lululemon may learn a new move: The buyback)
Lululemon's reputation was tarnished last year following the March recall of its luon yoga pants, which were widely reported to pill and become sheer. The company's struggles became worse after a highly publicized interview with founder and former Chairman Chip Wilson, who told Bloomberg that the pants weren't meant for some women's bodies. Wilson resigned from the company's board in December.
Paired with increased competition from brands like Gap's Athleta, which sells its athletic wear at about a 13 percent discount to Lululemon, Oppenheimer said the company is lapping "significant disruption to business," and has the potential to increase its domestic store count by 100 to 150 stores over the next few years.
(Read more: Don't put too much stock in retail earnings)
"Besides store growth, new categories represent a significant opportunity in North America as Lululemon uses its brand equity to enter adjacent fitness markets," the note said.