5 Junior Growth Stocks Jim Cramer is Talking About

1. Lululemon Athletica Inc. (NASDAQ:LULU)

Number of Hedge Fund Holders: 64

Lululemon Athletica Inc. (NASDAQ:LULU) is the only stock on Cramer’s list that is a “senior-growth stock,” but it’s one he could not help but include. He called the company “a lifestyle choice” instead of a simple apparel company; one that “people are choosing all over the world.”

TD Cowen analysts have kept an Outperform rating on the shares as of April 27, alongside raising their price target from $500 to $525.

Our hedge fund data shows 64 elite hedge funds long Lululemon Athletica Inc. (NASDAQ:LULU) in the first quarter, with a total stake value of $3.5 billion.

RiverPark Advisors made the following comment about Lululemon Athletica Inc. (NASDAQ:LULU) in its first-quarter 2023 investor letter:

“Lululemon Athletica Inc. (NASDAQ:LULU): We initiated a position in athletic apparel company Lululemon in the quarter. COVID-related supply chain bottlenecks led to over buying in 2022 resulting in a short-term inventory glut. This temporary issue gave us an opportunity to buy LULU’s stock at a historically low valuation.

LULU is a vertically integrated athletic apparel vendor focused on living a healthy and mindful lifestyle. The company, through its 655 stores and strong online presence (40% of sales), caters to affluent customers searching for both function and fashion. LULU has been a consistent innovator since its founding as a yoga brand in 1998 and currently offers an extensive array of men’s and women’s clothing options as well as yoga and fitness-related accessories. We believe that continued growth in the core women’s fitness category coupled with store growth, international expansion, and increased men’s sales can drive mid-teens revenue growth for the foreseeable future. The company’s vertical integration allows it to manage all aspects of the product cycle from design to manufacturing to sales, including when and how to discount excess inventory, which is a current focus. This vertical orientation also yields some of the best margins and free cash flow in the industry. We believe LULU can double revenue in the coming five years, which should lead to 150% EPS and free cash flow growth.”

You can also take a look at 14 Stocks “About To Pop” According To Jim Cramer and 10 Cheap Jim Cramer Stocks to Buy.