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DCF Valuation
Base-case fair value
$170.86
Intrinsic $227.81 · 25% MOS
Current price: $111.77
Base-case summary
Our base-case DCF for lululemon athletica inc. (LULU) projects 10 years of free cash flow growth at 5.2% for years 1–5 and 2.6% for years 6–10, anchored to 5.2% historical FCF growth, then applies a 2.5% perpetual growth rate and a 8.0% discount rate. Starting from $1.3B in trailing free cash flow, this produces an intrinsic value of $227.81 per share. A 25% safety margin gives a fair value of $170.86, suggesting the stock is currently 53% undervalued against the $111.77 market price.
See 3 scenarios side by side
Conservative, Base, and Optimistic fair values, plus the sensitivity matrix and FCF history. Free account.
Model inputs
TTM Free Cash Flow
$1.3B
Cash & equivalents
$1.5B
Total debt
$2.1B
Shares outstanding
115M