Is it time to take another look at this stock?
In these kinds of situations where the fundamentals are unclear, pros like Cramer often consult with technicians to see what the charts suggest. The following technical analysis was provided by Bob Lang, founder and senior strategist at Explosive Options.net, as well as a Cramer colleague at RealMoney.com
Looking at the weekly chart, Lang sees many constructive developments.
He says following the sharp decline lower in June, Lululemon has made a move from the lower left to the upper right – a bullish trajectory.
That trajectory matters a lot because Lululemon gapped down $12, dropping from $82 to $70 literally overnight, when Christine Day announced her resignation. Technicians like Lang believe that once a stock climbs back into the area of the gap, the stock will fill in that gap, meaning it will rise all the way to the level from which it declined. At $72 and change, Lang says Lululemon is now within the gap. Lang believes the stock is on a trajectory where it should fill in the gap in the not too distant future, something that would send LuluLemon to $82 or 13% higher.
And should that happen, Lang sees more reasons to feel bullish.