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1 Stock to Buy, 1 Stock to Sell This Week: Lululemon, Dollar Tree

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Jesse Cohen

Sun, Mar 23, 2025, 7:17 AM 6 min read

In This Article:

• PCE inflation data, Fed speakers, Trump tariff news will be in focus this week.

• Lululemon's strong brand presence, innovative product lines, and effective marketing strategies position it favorably for a robust earnings report.

• Dollar Tree’s downbeat profit and sales growth prospects suggest a more cautious approach, potentially making it a stock to sell.

• Looking for actionable trade ideas to navigate the current market volatility? Subscribe here to unlock access to InvestingPro’s AI-selected stock winners.

U.S. stocks ended slightly higher on Friday, with the major indexes averting a fifth straight week of losses, after President Donald Trump signaled "flexibility" on upcoming reciprocal tariffs.

For the week, the Dow Jones Industrial Average jumped 1.2%, the S&P 500 gained 0.5%, while the tech-heavy Nasdaq Composite rose 0.2%.

Source: Investing.com

The week ahead is expected to be another busy one as investors continue to assess the outlook for the economy, inflation, interest rates and corporate earnings amid President Trump’s trade war.

Most important on the economic calendar will be Friday’s core PCE price index, which is the Fed's favorite inflation gauge. That will be accompanied by a heavy slate of Fed speakers, including district governors Tom Barkin, Raphael Bostic, Neel Kashkari, and Alberto Musalem all set to make public appearances.

Source: Investing.com

Elsewhere, on the earnings docket, there are just a handful of corporate results due, including Lululemon (NASDAQ:LULU), GameStop (NYSE:GME), Chewy (NYSE:CHWY), McCormick (NYSE:MKC), KB Home (NYSE:KBH), and Dollar Tree (NASDAQ:DLTR).

Regardless of which direction the market goes, below I highlight one stock likely to be in demand and another which could see fresh downside. Remember though, my timeframe is just for the week ahead, Monday, March 24 - Friday, March 28.

Lululemon, the Canadian athletic wear giant, is preparing to unveil its fourth-quarter earnings on Thursday at 4:05PM ET. According to the options market, traders are pricing in a swing of about 10% in either direction for LULU stock following the print. Shares gapped up 16.7% after the last earnings report came out in December.

Renowned for its innovative products, strong brand loyalty, and expanding market presence, Lululemon has long been a favorite among both investors and analysts. Recent optimism has been evident, with profit estimates revised upward 26 times in the weeks leading up to the report—compared to zero downward revisions, according to InvestingPro.


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