Tag: Inflection

Delta Apparel Is At The Start Of A Significant Positive Inflection, With Near-Term Catalysts (NYSEMKT:DLA)

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Thesis

I believe Delta Apparel, Inc. (DLA) will increase dramatically, with upside potential of $45+, due to imminent catalysts and the stock’s tremendous undervaluation. There are also many catalysts that I expect to drive an upward revaluation, most imminently DLA’s next earnings report (expected in November) which I project to be tremendously above consensus (one analyst) expectations. There has been the perfect storm of positive events that have occurred for DLA, yet the stock has barely reacted, and is near multi-year lows.

DLA is a high-growth technology and apparel company being undervalued by the market, because it is a small-cap in the apparel retail sector.

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Lululemon Athletica Reaches Inflection Point in E-Commerce Business

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Some investors might have thought lululemon athletica‘s (NASDAQ:LULU) e-commerce business couldn’t get any better than the fiscal first quarter, but it did. E-commerce sales accelerated again to a triple-digit growth rate and made up 61% of total revenue during the fiscal second quarter. That is up from 25% in the year-ago quarter. 

Management sees e-commerce growth remaining at elevated levels, though not as high as the recent quarter, which could be beneficial to Lululemon’s bottom line beyond COVID-19.

A woman holding a credit card, while using a laptop.

Image source: Getty Images.

Online demand is off the charts

For the quarter, total revenue increased 2% year over year, driven by an impressive 157% increase in e-commerce sales. Excluding a warehouse sale during the quarter, e-commerce still grew 137%. Lululemon also saw strength in full-price sales, which kept product margin flat year over year. 

During the fiscal second-quarter conference call, CEO Calvin McDonald said: “2020 is likely an inflection point

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