October 26, 2009 / 8:57 PM / 10 years ago

UPDATE 2-Lululemon stock jumps as it raises forecasts

* Sees earnings between 17 and 19 cents a share

* Expects revenue between $110 mln and $112 mln

* Shares up 8.4 pct at $27.88 in after hours trade (Recasts with stock rise, adds background; in U.S. dollars unless noted)

VANCOUVER, British Columbia, Oct 26 (Reuters) - Shares in Lululemon Athletica LLL.TO (LULU.O) jumped 8.4 percent on Monday after the yoga clothing and athletic gear maker raised its third-quarter earnings and revenue forecasts.

Lululemon stock rose to $27.88 in after-hours trading on Nasdaq, after the company said there had been stronger than expected demand for its clothing, including new apparel lines.

“By staying in stock in our core items, as well as our new running line and seasonal outerwear offerings, we have been able to satisfy strong ... demand and exceed our original revenue expectations for the quarter,” Lululemon Chief Executive Christine Day said in a statement.

Vancouver-based Lululemon now expects diluted earnings per share of between 17 cents and 19 cents for the three months ending Nov. 1. Previously, it had forecast earnings in a range of 11 cents to 13 cents a share.

It forecast revenues of between $110 million and $112 million in the third quarter, up from previous guidance of between $95 million and $100 million.

Same-store sales in the third quarter are expected to show a “high-single digit increase” on a constant dollar basis, compared with an earlier, relatively flat forecast, the company said.

Last month, Goldman Sachs raised its target price on a slew of retailers, including Lululemon, saying that most signs pointed to robust U.S. September sales trends, which it expected to continue into the Christmas season.

Goldman attributed some of the good sales to cooler weather, which boosts purchases of seasonal apparel.

Lululemon’s stock closed 3 percent firmer at C$27.39 on the Toronto Stock Exchange on Monday. It gained 1.5 percent to close at $25.71 on Nasdaq. The announcement came out after the markets had closed.

$1=$1.07 Canadian Reporting by Nicole Mordant; editing by Rob Wilson

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