Comparison Would appreciate your view on Aritzia and its trajectory relative to LULU. Are we in early innings with ATZ with Lulu being more mature? In 5 years, could ATZ have at least 50% of Lulu market cap? The growth strategy seems sound and their stores are always jammed.
ATZ and LULU do target different demographics of customers, however, both of them possess really strong brand awareness among consumers. ATZ is in the early innings for growth, especially in the US where it seems to have a very long runway for growth. We like ATZ and we think ATZ could replicate the success of LULU, to a point. We are not so sure that ATZ will able to achieve the same global brand appeal as LULU has in its history. While we like ATZ's prospects, 50% of LULU’s market cap in the next five years may be an aggressive target, as LULU is currently 10x larger than ATZ. However, we think that ATZ has a good chance of doing well compared to the market. It has executed well in some tough times, and remains poised for good future growth. (5iResearch)