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Back on Aug. 3, Cramer named Lululemon Athletica as a growth stock on par with Crocs and Under Armour. Less than two months later, the yoga apparel company is up 28%, and Cramer said it isn’t done.
He has his critics, though. Many on the Street can’t understand how a niche retailer with such a tiny demographic can continue at this rate. What they don’t understand, Cramer said, is that Lululemon’s [LULU Loading... ()
] customers aren’t just yogis – they’re women. And women account for 90% of the store’s sales. So instead of serving maybe 2% of the population, Lululemon is now serving about 51%. “I don’t think people really understand the power of exercise fitness and healthy living,” CEO Bob Meers said. “It’s a global opportunity and not a niche opportunity.”
“Lululemon is a lifestyle,” Meers said, and that offers the chance to build out the brand. The CEO said the company will focus more on apparel and maybe even footwear in the future.
The Vancouver, Canada-based retailer also has the potential to grow its U.S. store count to 300, Cramer said, but customers will never find Lululemon clothing in a Kohl’s [KSS
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] or Target [TGT
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]. Meers said it would come at the cost of Lululemon’s caché: “We think the right thing to do is be special.”
The bottom line: The multiple years of growth Cramer said Lululemon could have make this stock very special.
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