T2's Whitney Tilson Must Really Hate Yoga Today...
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T2 Partners' Whitney Tilson is known in part for his short positions, most notably on one Netflix (Nasdaq: NFLX) which he un-shorted due in part to a letter from CEO Reed Hastings.
Today, Tilson is feeling the pain once again, a pain that has been a long time coming. Since about 2010, we'll say mid-year, Tilson has touted lululemon athletica (Nasdaq: LULU) as basically "the dumbest idea around." He said in an October 2010 Barron's piece that lululemon is basically "selling a $1 piece of spandex for $100."
Hmm...seems like the most profitable way to go, actually.
He's been short through 2011 and into February 2012, when he once again crowed about the overvaluation lululemon carries. On CNBC, Tilson said, "We've gone back and we did the work again. It's a fine company – but we're short because it's trading at 10.6 times sales – and 41 times earnings – and operating at 20% net margins." He went on to say historically, in retail, those metrics don't add up.
So, lululemon was at about $20 in August 2010. Since then, shares have comfortably melted higher, rising 280 percent to current levels above $75.
Today, lululemon once-again issued an earnings beat while raising its outlook in the process.
Let's just hope that Tilson doesn't walk by a yoga center today. We'd hate to see the results.
Shares of lululemon are up about 10 percent on the session.
Today, Tilson is feeling the pain once again, a pain that has been a long time coming. Since about 2010, we'll say mid-year, Tilson has touted lululemon athletica (Nasdaq: LULU) as basically "the dumbest idea around." He said in an October 2010 Barron's piece that lululemon is basically "selling a $1 piece of spandex for $100."
Hmm...seems like the most profitable way to go, actually.
He's been short through 2011 and into February 2012, when he once again crowed about the overvaluation lululemon carries. On CNBC, Tilson said, "We've gone back and we did the work again. It's a fine company – but we're short because it's trading at 10.6 times sales – and 41 times earnings – and operating at 20% net margins." He went on to say historically, in retail, those metrics don't add up.
So, lululemon was at about $20 in August 2010. Since then, shares have comfortably melted higher, rising 280 percent to current levels above $75.
Today, lululemon once-again issued an earnings beat while raising its outlook in the process.
Let's just hope that Tilson doesn't walk by a yoga center today. We'd hate to see the results.
Shares of lululemon are up about 10 percent on the session.
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