5 Best Fashion Stocks To Buy Now

2. Lululemon Athletica Inc. (NASDAQ:LULU)

Number of Hedge Fund Shareholders: 57

Hedge funds are going gaga over LULU. Lululemon Athletica Inc. (NASDAQ:LULU) was held in a record number of 13F portfolios during Q3 after a 30% increase in the smart money’s ownership of the stock over the past two quarters. Noam Gottesman’s GLG Partners and Steven Boyd’s Armistice Capital are among the many funds to have added LULU to their holdings this year.

Lululemon Athletica Inc. (NASDAQ:LULU) started out primarily as a seller of yoga apparel for women, but has rapidly expanded into men’s apparel and the broader athleasure apparel category in recent years. The company is continuing to push harder into men’s apparel, grow its digital business, and drive international (which currently accounts for just 17% of sales) expansion, which it believes will allow it to achieve a 15% CAGR through its 2026 fiscal year.

Lululemon Athletica Inc. (NASDAQ:LULU)’s sales soared by 29% during its fiscal quarter ended July 31, with a stellar 23% increase in comparable sales. And while most other fashion retailers have seen margins and profits slump this year, Lululemon’s earnings per share surged to $2.26 in its latest reported quarter, up $0.67 from a year earlier. It also grew its gross and operating margins, with the former hitting 56.5%.