Mostly Borrowed Ideas Deep Dives, MBI Deep Dives

MBI Deep Dives

Mostly Borrowed Ideas Deep Dives

MBI is the abbreviation for “Mostly Borrowed Ideas”. Why “Mostly Borrowed Ideas?” As a generalist, I do not have a background in any particular sector. I enjoy navigating across industries, businesses, and countries to learn, understand, and connect the dots. In any case, most ideas and innovations are incremental in nature. Very few of us are smart enough to come up with truly original or groundbreaking ideas. I am Abdullah Al-Rezwan. I was born and brought up in Bangladesh. I went to University of Dhaka for my undergrad and majored in Finance. After working three and half years in Equity Research (Sell-side) covering Financial Sector in Bangladesh, I left Bangladesh to pursue my MBA in the US. I graduated within top 10% of the class from Cornell University's two-year MBA program and worked on the buy-side following my graduation. During my time at Cornell, I won two stock pitch competitions and also became finalists in four other competitions. I thoroughly enjoyed my stint as a generalist in the US large cap team at Madison Investments and covered a wide range of companies from UnitedHealth to Amazon and Boeing before US immigration reality paused my career in investment management. As my work authorization expired, I moved to Canada in January, 2021. Then in early 2022, I was able to return to the US.

Equity Bottom-Up

<ul><li>Lululemon was facing some really thorny questions from Mr. Market ever since 4Q’23 earnings. Today’s earnings should help calm some nerves.</li><li>Here are my highlights from tonight’s call. Sales Growth by Region At first glance, one may find confirmation to plenty of concerns for LULU. US sales, which was ~61% of overall sales this quarter, grew by only 2%.</li><li>Growth momentum in international markets, especially in China helped mask the weakness in the US.</li></ul>

Lululemon was facing some really thorny questions from Mr. Market ever since 4Q’23 earnings. Today’s earnings should help calm some nerves.Here are my highlights from tonight’s call. Sales Growth by Region At first glance, one may find confirmation to plenty of concerns for LULU. US sales, which was ~61% of overall sales this quarter, grew by only 2%.Growth momentum in international markets, especially in China helped mask the weakness in the US.

US-EU Index Rebalances / Quantitative Researcher, Ortex

Dimitris Ioannidis

US-EU Index Rebalances / Quantitative Researcher

Global Financial Data and Analytics Platform

Ortex

ORTEX is a global financial data and analytics platform providing real-time securities lending and short interest data, index rebalance data, holdings and insider transactions, trading signals, corporate actions and news,  stock machine learning and factor scores and other analytics. The majority of the data are downloadable and accessible through APIs.

Event-Driven

<ul>
<li>Index Committee's discretion decreases the predictability of index changes. Even when a company passes all eligibility criteria and thresholds, it might still not be selected.</li>
<li>Understanding triggers for index changes, types of additions/deletions and selection patterns, narrows down the pool of candidates and increases conviction of forecasts.</li>
<li>
<a href="https://www.smartkarma.com/entities/dell-technologies-inc" target="_blank" data-smartkarma-citation="entities:32189:1" rel="noopener">Dell Technologies (DELL US)</a> is currently the main candidate to be added by transition to the S&amp;P 500 in September 2024 Quarterly Rebalance.</li>
</ul>


Index Committee's discretion decreases the predictability of index changes. Even when a company passes all eligibility criteria and thresholds, it might still not be selected.
Understanding triggers for index changes, types of additions/deletions and selection patterns, narrows down the pool of candidates and increases conviction of forecasts.

Dell Technologies (DELL US) is currently the main candidate to be added by transition to the S&amp;P 500 in September 2024 Quarterly Rebalance.


S&P 500 / S&P 1500: Deriving Forecasts & First Prediction for September

Independent Research, US Dominant Players, Investment Talk

Investment Talk

Independent Research, US Dominant Players

Investment Talk is for readers who wish to learn about companies that are potentially outside of their own circle of research, as well as those who are longing to become part of a community of like-minded investors and learn more about investment research. I would describe myself as a long-term investor who typically takes a 3Y to 5Y outlook, before reassessing once that period matures. I follow the adage that one should research, reach a conclusion, and then verify and continue to hold so long as the thesis remains intact. My own investing style is one that seeks to find dominant players within their respective market who have shown signs of monopoly or oligopolistic behaviour, unlikely to be disrupted, in tandem with discovering market disruptors who have a high likelihood of disrupting their respective market. Equally (and weighted accordingly) I seek to discover more nuanced, misunderstood, situations with a shorter time frame.

<ul><li>On March 21st, Lululemon reported FY23 results. All things considered, the results were good. Guidance, however, caused some upset. Lululemon shares are down ~29% this year; after being down just 6% before the report, and is currently the 8th worst-performing stock in the S&amp;P 500.</li><li>Lululemon’s implied 11.5% revenue growth for 2024 is a notable deceleration from years prior; having averaged an annual revenue growth rate of 24.4% over the last 5 years.</li><li>This year’s revenue guidance is closer to, but still behind, the 5 years before that; where Lululemon averaged 15.7% annual revenue growth.</li></ul>

On March 21st, Lululemon reported FY23 results. All things considered, the results were good. Guidance, however, caused some upset. Lululemon shares are down ~29% this year; after being down just 6% before the report, and is currently the 8th worst-performing stock in the S&amp;P 500.Lululemon’s implied 11.5% revenue growth for 2024 is a notable deceleration from years prior; having averaged an annual revenue growth rate of 24.4% over the last 5 years.This year’s revenue guidance is closer to, but still behind, the 5 years before that; where Lululemon averaged 15.7% annual revenue growth.

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

<ul><li>The Q4 2023 earnings of Lululemon Athletica Inc. highlighted positive operational results with revenue increases across most regions.</li><li>Total revenue was reported to have increased by 16% for the quarter.</li><li>In the Americas, the increase was 9%, while Mainland China saw a rather prominent rise of 78%.</li></ul>

The Q4 2023 earnings of Lululemon Athletica Inc. highlighted positive operational results with revenue increases across most regions.Total revenue was reported to have increased by 16% for the quarter.In the Americas, the increase was 9%, while Mainland China saw a rather prominent rise of 78%.

Lululemon Athletica Inc.: A Tale Of Store Expansion & International Growth! - Major Drivers

<ul><li>Lululemon Athletica Inc. delivered an all-around beat in Q3, reporting a robust 19% increase in total net revenue, reaching $2.2 billion.</li><li>The store channel experienced a substantial 19% increase, contributing to a global store count of 686, reflecting a 17% growth in square footage.</li><li>Q3 also highlighted the success of women's business, with a 19% boost attributed to new product launches like Wundermost, a bodywear collection.</li></ul>

Lululemon Athletica Inc. delivered an all-around beat in Q3, reporting a robust 19% increase in total net revenue, reaching $2.2 billion.The store channel experienced a substantial 19% increase, contributing to a global store count of 686, reflecting a 17% growth in square footage.Q3 also highlighted the success of women's business, with a 19% boost attributed to new product launches like Wundermost, a bodywear collection.

Lululemon Athletica Inc.: Digital Surge: Commanding 41% of Total Revenue! - Major Drivers

United States

lululemon athletica Inc. designs and retails athletic clothing.  The Company produces fitness pants, shorts, tops and jackets for yoga, dance, running, and general fitness. lululemon serves customers throughout the world.

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Lululemon Athletica (LULU US)

Lululemon 1Q'24 Update

Lululemon was facing some really thorny questions from Mr. Market ever since 4Q’23 earnings. Today’s earnings should help calm some nerves.

MBI Deep Dives

S&P 500 / S&P 1500: Deriving Forecasts & First Prediction for September

S&P Index Committee's discretion reduces predictability of index changes. Identifying patterns and types of changes, narrows down the addition...

Dimitris Ioannidis

Why Lululemon Isn’t Under Armour

Lululemon’s implied 11.5% revenue growth for 2024 is a notable deceleration from years prior; having averaged an annual revenue growth rate of...

Investment Talk

Lululemon Athletica Inc.: A Tale Of Store Expansion & International Growth! - Major Drivers

The Q4 2023 earnings of Lululemon Athletica Inc. highlighted positive operational results with revenue increases across most regions. Total...

Baptista Research

Lululemon Athletica Inc.: Digital Surge: Commanding 41% of Total Revenue! - Major Drivers

Lululemon Athletica Inc. delivered an all-around beat in Q3, reporting a robust 19% increase in total net revenue, reaching $2.2 billion. The...

Baptista Research

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Lululemon 1Q'24 Update

Lululemon was facing some really thorny questions from Mr. Market ever since 4Q’23 earnings. Today’s earnings should help calm some nerves.

MBI Deep Dives

S&P 500 / S&P 1500: Deriving Forecasts & First Prediction for September

S&P ​Index Committee's discretion reduces predictability of index changes. Identifying patterns and types of changes, narrows down the addition...

Dimitris Ioannidis

Why Lululemon Isn’t Under Armour

Lululemon’s implied 11.5% revenue growth for 2024 is a notable deceleration from years prior; having averaged an annual revenue growth rate of...

Investment Talk

Lululemon Athletica Inc.: A Tale Of Store Expansion & International Growth! - Major Drivers

The Q4 2023 earnings of Lululemon Athletica Inc. highlighted positive operational results with revenue increases across most regions. Total...

Baptista Research

Lululemon Athletica Inc.: Digital Surge: Commanding 41% of Total Revenue! - Major Drivers

Lululemon Athletica Inc. delivered an all-around beat in Q3, reporting a robust 19% increase in total net revenue, reaching $2.2 billion. The...

Baptista Research

S&P Index Committee's discretion reduces predictability of index changes. Identifying patterns and types of changes, narrows down the addition...