Is Lululemon Athletica inc. (LULU) In for More Quality Issues?

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The price of a high stock price
Even after falling 25% from its 52-week high, Lululemon’s stock still trades at 34 times trailing earnings, which prices in a lot of growth for the company. Even the mere thought that the company may have quality issues going forward is cause for concern and poses a risk for the company’s stock.

I have reason to question the quality of Lululemon Athletica inc. (NASDAQ:LULU)’s new Luon pants, and online reviews show that I’m not the only one. Keep an eye on this going forward, because a company with a rabid following like Lululemon can be in disbelief about a problem that new consumers see as clear as day. With perfect performance already priced into the stock, more bad reviews could send the stock south quickly.

The article Is Lululemon In for More Quality Issues? originally appeared on Fool.com.

Fool contributor Travis Hoium has no position in any stocks mentioned. The Motley Fool recommends Lululemon Athletica inc. (NASDAQ:LULU), Nike, and Under Armour and owns shares of NIKE, Inc. (NYSE:NKE) and Under Armour Inc (NYSE:UA).

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