![]() The worst fears were confirmed when Lululemon issued a press release on January 10, 2022. The World Health Organization or WHO announced in a Novemmedia release that it had already "designated the variant B.1.1.529 a variant of concern, named Omicron." This was followed by a DecemReuters article that Lululemon had cautioned that "the pandemic worsening due to COVID-19 variants could further impact supply chain issues and lead to temporary closures of some or all of its stores." In other words, there were concerns about the potential negative impact of the spread of the Omicron variant of COVID-19 on LULU since late-November and early-December 2021. LULU's stock price reached a historical high of $485.83 during intraday trading on November 16, 2021, and its last traded share price of $330.35 as of Februrepresents a -32% drop from the peak in the past two and a half months. Looking ahead, I don't see a substantial rebound for Lululemon's share price in the short term, as its forward P/E valuations remain demanding notwithstanding the recent share price correction. The recent drop in LULU's share price is understandable, considering that its fourth-quarter financial performance has been negatively affected by the Omicron variant. I reviewed LULU's Q2 2021 earnings in my previous article published on September 16, 2021. ![]() I maintain my Hold investment rating for Lululemon Athletica Inc.'s ( NASDAQ: LULU) shares. Robert Way/iStock Editorial via Getty Images Elevator Pitch ![]()
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