Lululemon shares end at record high after Oprah's blessing
TORONTO (Reuters) - Lululemon Athletica Inc. shares jumped 5 percent on Monday to close at a record high in Toronto after the trendy Canadian company's relaxed-fit pants were featured on Oprah Winfrey's television show.
With Oprah selecting the pants for her annual "Favorite Things" program, which aired on Friday, lululemon could ring up huge sales, Capstone Investment analyst Claire Gallacher wrote in a research note on Monday.
Oprah's marketing collaboration last year with Collective Brands, parent of Payless ShoeSource, resulted in a million pairs of shoes sold in a single day, the most in the company's history, Gallacher pointed out.
"Women all over the country heard Oprah say on her show, 'I've got to tell you, anything that cuts your butt in half should be your favorite thing too!'," Gallacher wrote in her note, referring to lululemon's pants.
"We believe Oprah's endorsement of lululemon introduced the product to many women that previously had little or no knowledge of the brand. For those already aware of (lululemon), Oprah's mention likely boosted the brand's image further."
Vancouver-based lululemon is a Canadian success story, dominating a lucrative niche market in an intensely competitive athletic sporting goods industry.
It is one of the few Canadian retailers that has also successfully entered the U.S. market, with plans for further expansion.
Lululemon, which only has 75 stores in the United States, finished C$2.61 higher, or 5.08 percent, at C$54.00 on the Toronto Stock Exchange. On the Nasdaq, shares were up $2.65, or 5.24 percent, at $53.25.
($1=$1.02 Canadian) (Reporting by Solarina Ho)
© Thomson Reuters 2016 All rights reserved.