Core Viewpoint - Lululemon has experienced a significant decline in stock performance, down nearly 50% in 2025, primarily due to increased competition and macroeconomic challenges in the athleisure market, with shares falling over 60% from all-time highs [1] Group 1: North American Market Performance - Lululemon's trailing-12-month revenue in North America more than doubled from $3.5 billion to $7.6 billion from Q3 2020 to Q4 2023, but has since stagnated at around $8 billion [2] - Revenue growth in North America has slowed, with a mere 4% year-over-year increase last quarter in constant currency [2] - Competitors like Nike and Athleta have also faced revenue declines, with Nike down 11% and Athleta down 6%, making Lululemon's 4% growth appear more favorable in context [3] Group 2: International Expansion Opportunities - Lululemon's international revenue grew 20% year-over-year in constant currency last quarter, with mainland China revenue up 22% despite a spending recession [5] - The company is beginning to expand in East Asia and Europe, recently opening a flagship store in Milan, indicating significant growth potential in these markets [6] - Even with sluggish North American growth, international markets can support Lululemon's overall performance [7] Group 3: Financial Metrics and Stock Valuation - Lululemon currently has a market cap of $22.7 billion, with a trailing price-to-earnings ratio under 13, the lowest in 10 years, suggesting the stock is undervalued [9] - The company has increased stock buybacks to $1.77 billion over the last 12 months, nearing a 10% repurchase of outstanding stock annually, which could enhance earnings per share growth [10] - The combination of a low earnings ratio and an aggressive buyback program positions Lululemon for potential stock price appreciation [11]