Recent insider trends for Lululemon Athletica Inc. (NASDAQ:LULU) have caught the attention of investors. Insider data is useful because it can reveal what a company’s executives and largest shareholders feel about a stock. In this case, the data has some interesting things to say about how LULU might perform in the future.
Institutions own 89.03% of Lululemon Athletica Inc. (LULU)’s shares. The total value of these holdings, in millions, is $8,641. Among active positions in the latest quarter, 182 holders increased their positions by a total of 14.42 million shares, 161 holders decreased the positions by a total of 11.44 million shares, and 65 holders held their positions. This works out to a net increase in ownership of 2.97 million shares, and suggests that institutions are feeling bullish about the stock.
Among new and sold out positions, 80 holders initiated new positions by a total of 5.83 million shares and 37 holders exited their positions by a total of 2.04 million shares. This nets out to an increase of 3.79 million shares and is a bullish sign for LULU.
In the last three months, insiders executed a total of 6 trades. 6 were sells. Insider ownership decreased by a total of 2.75 million shares, which suggests that LULU’s key executives are feeling less optimistic about the outlook for the stock. The data from the past twelve months tells a similar story: insiders executed 20 buys and 18 sells, and ownership decreased by a net of 2.62 million shares.
Short interest, or the number of a stock’s tradable shares currently being shorted, is another metric investors use to get a pulse on sentiment. Lululemon Athletica Inc. (NASDAQ:LULU)’s short interest is 3.81 million shares, or 3.63% of the float. This represents a decrease of -20% in the number of shares being shorted compared to the previous reading, and implies that investors felt less pessimistic about the stock during the past two weeks.
Ownership trends and trading patterns can be useful tools for predicting a stock’s performance, but it’s also important to consider the technicals in order to form a more comprehensive view. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that LULU is a Strong buy, which implies that LULU is expected to outperform the market based on prior trading patterns.
Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bearish. Technical indicators (also) suggest that Lululemon Athletica Inc. (NASDAQ:LULU) is undervalued.