Investing.com -- Lululemon Athletica (NASDAQ:LULU) reported fiscal first-quarter results that beat analysts' forecasts as lower transportation costs and growth in China bolstered results.
Lululemon Athletica shares trade about 15% higher in pre-market Friday trading.
The company announced EPS of $2.28 on revenue of $2.00 billion. Analysts polled by Investing.com anticipated EPS of $1.96 on revenue of $1.92B.
"A meaningful acceleration in our China sales trend, coupled with lower air freight, contributed to our better-than-planned financial performance," the company said.
Comparable sales increased 14%, with comparable store sales up 13% and direct-to-consumer net revenue up 16%. Gross margin increased 360 basis points to 57.5%.
For Q2, the company sees diluted earnings per share in the range of $2.47 to $2.52 and revenue in the range of $2.140B to $2.170B, in line with estimates of $2.49 per share and $2.16B respectively.
For 2023, diluted earnings per share was forecast in the range of $11.74 to $11.94 for the year on revenue of $9.440B to $9.510B.
BMO analysts boosted the price target on LULU stock to $355 per share as the earnings beat was "broad based."
"This was a clean and healthy beat and with the stock price increasing in the aftermarket, we believe this is reflected in the shares," they said in a note.
Goldman Sachs analysts said the results were "strong across all key line items."
"We step away from the quarter incrementally constructive on the path for growth for the brand and believe the company's strong innovation is leading to ongoing market share capture," they said.
"We continue to see LULU as a growth compounder, with growth supported by best-in-class innovation and international expansion. We continue to see an attractive risk/reward and reiterate our Buy rating."
Additional reporting by Senad Karaahmetovic