Is lululemon athletica, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for lululemon athletica, Inc. moved from fair to attractive, indicating a shift towards a more favorable assessment. The company appears to be undervalued, with a P/E ratio of 18, an EV to EBITDA of 11.20, and a PEG ratio of 1.03, suggesting that it is trading at a reasonable valuation relative to its growth prospects. In comparison, eBay, Inc. has a significantly higher P/E ratio of 70.51, highlighting lululemon's more attractive valuation within the E-Retail/E-Commerce industry.
Despite this positive valuation outlook, lululemon has faced significant stock price declines, with a year-to-date return of -56.22% compared to the S&P 500's gain of 13.30%. This stark contrast in performance underscores the potential for recovery as the company's valuation metrics suggest it may be undervalued relative to its peers.