ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. Lululemon Athletica's annualized return on invested capital (ROIC %) for the quarter that ended in Apr. 2026 was 12.94%.
As of today (2026-06-30), Lululemon Athletica's WACC % is 5.80%. Lululemon Athletica's ROIC % is 25.08% (calculated using TTM income statement data).
Lululemon Athletica generates higher returns on investment than it costs the company to raise the capital needed for that investment. It is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases.
Lululemon Athletica (XTER:33L) ROIC % Explanation
ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROC %. The reason book values of debt and equity are used is because the book values are the capital the company received when issuing the debt or receiving the equity investments.
There are four key components to this definition. The first is the use of operating income or EBIT rather than net income in the numerator. The second is the tax adjustment to this operating income or EBIT, computed as a hypothetical tax based on an effective or marginal tax rate. The third is the use of book values for invested capital, rather than market values. The final is the timing difference; the capital invested is from the end of the prior year whereas the operating income or EBIT is the current year's number.
Why is ROIC % important?
Because it costs money to raise capital. A firm that generates higher returns on investment than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, Lululemon Athletica's WACC % is 5.80%. Lululemon Athletica's ROIC % is 25.08% (calculated using TTM income statement data).
Lululemon Athletica generates higher returns on investment than it costs the company to raise the capital needed for that investment. It is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases.
Be Aware
Like ROE % and ROA %, ROIC % is calculated with only 12 months of data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Lululemon Athletica ROIC % Related Terms
Lululemon Athletica ROIC % Historical Data
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The historical data trend for Lululemon Athletica's ROIC % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Apparel Retail subindustry, Lululemon Athletica's ROIC %, along with its competitors' market caps and ROIC % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Lululemon Athletica ROIC % vs Retail - Cyclical Industry
For the Retail - Cyclical industry and Consumer Cyclical sector, Lululemon Athletica's ROIC % distribution charts can be found below:
* The bar in red indicates where Lululemon Athletica's ROIC % falls into.
Note:
The Operating Income data used here is four times the quarterly (Apr. 2026) data.
The tax rate is limited to between 0% and 100%.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Lululemon Athletica (XTER:33L) has a ROIC % of 12.94% as of Apr. 2026. Return on invested capital is the ratio of current-period net income to average two-period invested capital. View historical data on Lululemon Athletica and its competitors.
Is Lululemon Athletica's ROIC % too high?
Lululemon Athletica's current ROIC % is 12.94%. The Retail - Cyclical industry median ROIC % is 4.36. Lululemon Athletica's value of 12.94% is 196.8% above this industry median. Overall, Lululemon Athletica has a GF Score™ of 84/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Lululemon Athletica's ROIC % compare to GAP and VSXY?
Lululemon Athletica's ROIC % of 12.94% can be compared against companies in the Retail - Cyclical industry. The industry median ROIC % is 4.36. Lululemon Athletica's value of 12.94% is 196.8% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROIC % for a Retail - Cyclical company?
The median ROIC % among Retail - Cyclical companies is 4.36, based on 1,108 companies in the industry. Companies in the top quartile (top 25%) have a ROIC % significantly above this median, while those in the bottom quartile fall well below. However, ROIC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Lululemon Athletica's current ROIC % of 12.94% is 196.8% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROIC % mean?
A high ROIC % can signal that a stock is expensive relative to its fundamentals. Return on invested capital is the ratio of current-period net income to average two-period invested capital. View historical data on Lululemon Athletica and its competitors. For the Retail - Cyclical industry, the median ROIC % is 4.36 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Lululemon Athletica's current ROIC % is 12.94%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Lululemon Athletica stock overvalued right now?
Based on GuruFocus' analysis, Lululemon Athletica (XTER:33L) is currently considered Significantly Undervalued. The stock's GF Value™ is €312.08, compared to a current price of €99.40 — trading 68.1% below its estimated fair value. The current ROIC % is 12.94% and 196.8% above the Retail - Cyclical industry median of 4.36. Lululemon Athletica's overall GF Score™ is 84/100 with 1 warning sign to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROIC % calculated?
ROIC % is calculated from a company's financial statements. For Lululemon Athletica (XTER:33L), the current ROIC % is 12.94% as of Apr. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Lululemon Athletica (XTER:33L) Overvalued in 2026?
Based on GuruFocus' analysis, Lululemon Athletica stock appears to be undervalued.
The current stock price of €99.40 is trading 68.1% below its estimated GF Value™ of €312.08.
GuruFocus considers Lululemon Athletica to be Significantly Undervalued.
Key valuation signals for XTER:33L:
ROIC %: 12.94%
GF Value™: €312.08 vs. price of €99.40 (68.1% below fair value)
Industry Position: 196.8% above the Retail - Cyclical median
No single metric tells the full story. See the XTER:33L stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Lululemon Athletica designs, distributes, and markets athletic apparel, footwear, and accessories for women, men, and girls. The company offers pants, shorts, tops, and jackets for both leisure and athletic activities such as yoga and running. Lululemon also sells fitness accessories, such as bags, yoga mats, and equipment. It sells its products through digital channels, a small number of wholesale partners, more than 800 company-owned stores in about two dozen countries in North America, Asia, and Western Europe, and about 45 franchised locations in the Middle East and Europe. The company was founded in 1998 and is based in Vancouver, Canada.
84GF Score
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