Lululemon Athletica Stock Beneish M Score

LULU Stock  USD 390.65  1.19  0.31%   
This module uses fundamental data of Lululemon Athletica to approximate the value of its Beneish M Score. Lululemon Athletica M Score tells investors if the company management is likely to be manipulating earnings. The score is calculated using eight financial indicators that are adjusted by a specific multiplier. Please note, the M Score is a probabilistic model and cannot detect companies that manipulate their earnings with 100% accuracy. Check out Lululemon Athletica Piotroski F Score and Lululemon Athletica Altman Z Score analysis.
For more information on how to buy Lululemon Stock please use our How to Invest in Lululemon Athletica guide.
  
Net Debt is likely to gain to about (798.6 M) in 2024. Short Term Debt is likely to drop to about 136.4 M in 2024. At this time, Lululemon Athletica's Ebt Per Ebit is comparatively stable compared to the past year. Quick Ratio is likely to gain to 1.60 in 2024, whereas Pretax Profit Margin is likely to drop 0.19 in 2024.
At this time, it appears that Lululemon Athletica is an unlikely manipulator. The earnings manipulation may begin if Lululemon Athletica's top management creates an artificial sense of financial success, forcing the stock price to be traded at a high price-earnings multiple than it should be. In general, excessive earnings management by Lululemon Athletica executives may lead to removing some of the operating profits from subsequent periods to inflate earnings in the following periods. This way, the manipulation of Lululemon Athletica's earnings can lead to misrepresentations of actual financial condition, taking the otherwise loyal stakeholders on to the path of questionable ethical practices and plain fraud.
-2.56
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables

1.0

Focus
Asset Quality

0.97

Focus
Expense Coverage

1.0

Focus
Gross Margin Strengs

0.96

Focus
Accruals Factor

1.0

Focus
Depreciation Resistance

1.0

Focus
Net Sales Growth

1.05

Focus
Financial Leverage Condition

1.1

Focus

Lululemon Athletica Beneish M-Score Indicator Trends

The cure to earnings manipulation is the transparency of financial reporting. It will typically remove the temptation of the top executives to inflate earnings (i.e., to promote the idea of 'winning at any cost'). Because a healthy internal audit department can enhance transparency, the board should promote the auditors' access to all the record-keeping systems across the enterprise. For example, if Lululemon Athletica's auditors report directly to the board (not management), the managers will be reluctant to manipulate simply due to the fear of punishment. On the other hand, the auditors will be free to investigate the ledgers properly because they know that the board has their back.
Current ValueLast YearChange From Last Year 10 Year Trend
Net Receivables131 M124.8 M
Sufficiently Up
Slightly volatile
Total Revenue10.1 B9.6 B
Sufficiently Up
Slightly volatile
Total Assets7.4 B7.1 B
Sufficiently Up
Slightly volatile
Total Current Assets4.3 B4.1 B
Sufficiently Up
Slightly volatile
Non Current Assets Total3.2 BB
Sufficiently Up
Slightly volatile
Property Plant Equipment1.5 B1.5 B
Sufficiently Up
Slightly volatile
Depreciation And Amortization398.4 M379.4 M
Sufficiently Up
Slightly volatile
Selling General Administrative3.6 B3.4 B
Sufficiently Up
Slightly volatile
Total Current Liabilities1.7 B1.6 B
Sufficiently Up
Slightly volatile
Non Current Liabilities Total1.3 B1.2 B
Sufficiently Up
Slightly volatile
Short Term Debt136.4 M249.3 M
Way Down
Slightly volatile
Operating Income2.3 B2.2 B
Sufficiently Up
Slightly volatile
Short Term Investments6.8 K7.2 K
Notably Down
Slightly volatile
Gross Profit Margin0.560.5826
Sufficiently Down
Slightly volatile

Lululemon Athletica Beneish M-Score Driver Matrix

One of the toughest challenges investors face today is learning how to quickly synthesize historical financial statements and information provided by the company, SEC reporting, and various external parties in order to detect the potential manipulation of earnings. Understanding the correlation between Lululemon Athletica's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Lululemon Athletica in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Lululemon Athletica's degree of accounting gimmicks and manipulations.

About Lululemon Athletica Beneish M Score

M-Score is one of many grading techniques for value stocks. It was developed by Professor M. Daniel Beneish of the Kelley School of Business at Indiana University and published in 1999 under the paper titled The Detection of Earnings Manipulation. The Beneish score is a multi-factor model that utilizes financial identifiers to compile eight variables used to classify whether a company has manipulated its reported earnings. The variables are built from the officially filed financial statements to create a final score call 'M Score.' The score helps to identify companies that are likely to manipulate their profits if they show deteriorating gross margins, operating expenses, and leverage against growing revenue.

Depreciation And Amortization

398.35 Million

At this time, Lululemon Athletica's Depreciation And Amortization is comparatively stable compared to the past year.

Lululemon Athletica Earnings Manipulation Drivers

Although earnings manipulation is typically not the result of intentional misconduct by the c-level executives, it is still a widespread practice by the senior management of public companies such as Lululemon Athletica. It is usually done by a series of misrepresentations of various accounting rules and operating activities across multiple financial cycles. The best way to spot the manipulation is to examine the historical financial statement to find inconsistencies in earning reports to find trends in assets or liabilities that are not sustainable in the future.
201920202021202220232024 (projected)
Net Debt(141.4M)(351.8M)(378.8M)(84.5M)(840.7M)(798.6M)
Investments347K(695.5M)(23.4M)47.8M(654.1M)(621.4M)

Lululemon Athletica ESG Sustainability

Some studies have found that companies with high sustainability scores are getting higher valuations than competitors with lower social-engagement activities. While most ESG disclosures are voluntary and do not directly affect the long term financial condition, Lululemon Athletica's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Lululemon Athletica's managers, analysts, and investors.
Environment Score
Governance Score
Social Score

About Lululemon Athletica Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Lululemon Athletica's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Lululemon Athletica using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Lululemon Athletica based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.
lululemon athletica inc., together with its subsidiaries, designs, distributes, and retails athletic apparel and accessories for women and men. As of January 30, 2022, it operated 574 company-operated stores under the lululemon brand in the United States, Canada, the Peoples Republic of China, Australia, the United Kingdom, Japan, New Zealand, Germany, South Korea, Singapore, France, Malaysia, Sweden, Ireland, the Netherlands, Norway, and Switzerland. lululemon athletica inc. was founded in 1998 and is based in Vancouver, Canada. Lululemon Athletica operates under Apparel Retail classification in the United States and is traded on NASDAQ Exchange. It employs 29000 people.

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When determining whether Lululemon Athletica is a good investment, qualitative aspects like company management, corporate governance, and ethical practices play a significant role. A comparison with peer companies also provides context and helps to understand if Lululemon Stock is undervalued or overvalued. This multi-faceted approach, blending both quantitative and qualitative analysis, forms a solid foundation for making an informed investment decision about Lululemon Athletica Stock. Highlighted below are key reports to facilitate an investment decision about Lululemon Athletica Stock:
Check out Lululemon Athletica Piotroski F Score and Lululemon Athletica Altman Z Score analysis.
For more information on how to buy Lululemon Stock please use our How to Invest in Lululemon Athletica guide.
You can also try the Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.

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Is Lululemon Athletica's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Lululemon Athletica. If investors know Lululemon will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Lululemon Athletica listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
4.639
Earnings Share
12.19
Revenue Per Share
75.906
Quarterly Revenue Growth
0.156
Return On Assets
0.2173
The market value of Lululemon Athletica is measured differently than its book value, which is the value of Lululemon that is recorded on the company's balance sheet. Investors also form their own opinion of Lululemon Athletica's value that differs from its market value or its book value, called intrinsic value, which is Lululemon Athletica's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Lululemon Athletica's market value can be influenced by many factors that don't directly affect Lululemon Athletica's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Lululemon Athletica's value and its price as these two are different measures arrived at by different means. Investors typically determine if Lululemon Athletica is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Lululemon Athletica's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.