Q: What are you thoughts about the class action lawsuit against LULU? Can you give an assessment of the management, how significant the allegations are if true, and in your experience whether more negative findings will come to light?
5i Research Answer:
The class action lawsuit claims that LULU misled investors over the period of December 7, 2023 and July 24, 2024 where LULU stock was purchased at artifically inflated prices. These claims constantly come up and typically are a non event as they are very hard to prove and take a long time to even reach a settlement that will usually not give plaintiffs a significant return. We would not be view this as a significant concern. Any time a stock declines a lot several lawsuits typically show up.