JPMorgan downgrades Lululemon on product assortment challenges

JPMorgan analyst Matthew Boss downgraded Lululemon (LULU) to Neutral from Overweight with a price target of $224, down from $303. Field work shows that while consumers are responding favorably to Lululemon’s new product and fabric innovation, this is being more than offset by customers not responding as well to the updated core-seasonal colors, which represents an estimated 40% of the inventory mix, the analyst tells investors in a research note. JPMorgan says that in addition to Lululemon-specific conversion rate headwinds due to product assortment challenges, management has noted Americas same-store-sales growth constraints associated with a decrease in store traffic amid a challenged macro backdrop. As a result, the firm sees Lululemon missing its fiscal 2026 analyst day plan.