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Jim Cramer Says “LULU’s in the Penalty Box Here”

lululemon athletica inc. (NASDAQ:LULU) is one of the stocks listed in our article, Jim Cramer recently discussed these 10 S&P 500 stocks. Cramer acknowledged that he was wrong about LULU bouncing back in May and said:

“The fourth worst performer, wow, lululemon athletica, the former athleisure kingpin, which suffered a nearly 38% decline in the first half. lululemon’s struggling for some of the same reasons as Deckers, and that includes an excessive reliance on Vietnamese manufacturing, which we all thought people should be doing. Back in late May, I told you that lululemon might be due for a comeback, given how far its stock had fallen. That was a big mistake of mine. I guess I had too much reverence for the brand, and I thought the expectations were too low.

No, turns out they weren’t low enough. LULU reported a stinker of a quarter last month, sending its stock down almost 20% in a single session, and it hasn’t been able to find its footing since. Can LULU come back now? Stock’s certainly cheap, selling for less than 17 times this year’s earnings estimates, but I just stuck my neck out on this one only to have it chopped off. At the end of the day, while LULU pretty much invented the athleisure space, that business has become incredibly competitive. So until they can put up better numbers, LULU’s in the penalty box here.”

A store employee in an athletic apparel store restocking merchandise.

lululemon athletica (NASDAQ:LULU) designs athletic apparel, footwear, and accessories for both men and women.

While we acknowledge the potential of LULU as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money.

Disclosure: None.

The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

Do the math. According to Musk, this technology could be worth $250 trillion by 2040.

Put another way, that’s roughly equal to:

  • 175 Teslas
  • 107 Amazons
  • 140 Metas
  • 84 Googles
  • 65 Microsofts
  • And 55 Nvidias

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It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.

Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.

How could anything be worth that much?

The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.

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In fact, Verge argues this company’s supercheap AI technology should concern rivals.

Before I reveal the details, let’s talk about how some of the richest people on the planet are positioning themselves.

  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.

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