DCF Studio

    LULU · NMS · Consumer Cyclical

    lululemon athletica inc.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 220.69

    Market price

    USD 107.83

    Implied upside

    +104.7%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2026-01-31

    AdjustedCapital expenditure runs at 6.8% of revenue against depreciation of 4.1%. A perpetuity has to be a steady state, so the forecast tapers capex to maintenance at depreciation plus the reinvestment terminal growth requires (g/ROIC of NOPAT), and the terminal year carries on from there. The bridge is shown under Terminal Value.

    Value Per Share

    Perpetuity growth
    USD 220.69+104.7%
    Exit multiple
    USD 145.87+35.3%
    Market price
    USD 107.83

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn1bn2bnFY27FY28FY29FY30FY31FY32FY33FY34FY35FY36
    Nominal FCFFDiscounted to todayUSD
    LineFY27FY28FY29FY30FY31FY32FY33FY34FY35FY36CAGR
    RevenueUSD 10.5bnUSD 10.3bnUSD 10.3bnUSD 10.2bnUSD 10.3bnUSD 10.3bnUSD 10.4bnUSD 10.6bnUSD 10.8bnUSD 11.1bn+0.6%
    EBITUSD 2.3bnUSD 2.3bnUSD 2.3bnUSD 2.2bnUSD 2.3bnUSD 2.3bnUSD 2.3bnUSD 2.3bnUSD 2.4bnUSD 2.4bn+0.6%
    NOPATUSD 1.8bnUSD 1.8bnUSD 1.8bnUSD 1.8bnUSD 1.8bnUSD 1.8bnUSD 1.8bnUSD 1.8bnUSD 1.9bnUSD 1.9bn+0.6%
    Add depreciation & amortisationUSD 424.7mUSD 419.6mUSD 416.5mUSD 415.3mUSD 416.1mUSD 418.8mUSD 423.4mUSD 430.1mUSD 438.8mUSD 449.8m+0.6%
    Less capital expenditureUSD -714.3mUSD -684.9mUSD -659.3mUSD -637.0mUSD -617.6mUSD -601.0mUSD -586.7mUSD -574.8mUSD -564.8mUSD -556.8m-2.7%
    Capex, % of revenue6.8%6.6%6.4%6.2%6.0%5.8%5.6%5.4%5.2%5.0%-
    Less increase in working capitalUSD 83.2mUSD 16.6mUSD 10.1mUSD 3.8mUSD -2.5mUSD -8.7mUSD -15.0mUSD -21.5mUSD -28.3mUSD -35.5m-
    Free cashflow to firmUSD 1.6bnUSD 1.5bnUSD 1.5bnUSD 1.6bnUSD 1.6bnUSD 1.6bnUSD 1.6bnUSD 1.7bnUSD 1.7bnUSD 1.8bn+1.1%
    Discount factor0.96110.88770.81990.75730.69950.64610.59670.55120.50910.4702-
    Present valueUSD 1.5bnUSD 1.4bnUSD 1.3bnUSD 1.2bnUSD 1.1bnUSD 1.0bnUSD 973.5mUSD 921.5mUSD 876.3mUSD 837.0m-
    Present Value Of The ForecastUSD 11.1bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.893Reported 0.841, pulled toward 1.0 (Blume)
    Cost of equity8.67%Risk-free + beta x equity risk premium
    Cost of debt6.89%Assumed: risk-free + 200bp (interest expense not reported)
    Market capitalisationUSD 12.5bn87.4% of capital
    Total debtUSD 1.8bn12.6% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC8.27%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 220.69

    58% of EV

    Forecast FCFF, final year
    USD 1.8bn
    Capex at depreciation, working capital in reinvestment
    USD 1.9bn
    Less reinvestment at g/ROIC (5.9% of NOPAT)
    USD -114.1m
    Capitalised
    USD 1.8bn
    ROIC (reported)
    42.3%
    Terminal value, undiscounted
    USD 32.2bn
    Terminal value, discounted
    USD 15.2bn
    Enterprise value
    USD 26.3bn
    Less net debt
    USD -8.8m
    Equity value
    USD 26.3bn

    Exit at 4.6x EBITDA

    Value per shareUSD 145.87

    36% of EV

    Terminal value, undiscounted
    USD 13.3bn
    Terminal value, discounted
    USD 6.3bn
    Enterprise value
    USD 17.4bn
    Less net debt
    USD -8.8m
    Equity value
    USD 17.4bn

    Spread between methods: 41%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    6.27%289.46309.18334.27367.19412.19
    7.27%239.64251.32265.56283.24305.74
    8.27%204.60211.96220.69231.15243.91
    9.27%178.62183.47189.09195.68203.49
    10.27%158.60161.88165.64169.97174.99

    Outlined: this model. Green text: above today's price of 107.83. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year11.0%-0.0%-8.8%
    EBIT margin23.7%22.0%11.1%
    Discount rate-8.3%14.7%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.