Lululemon Sparkles on Citi Endorsement

Lululemon Athletica (NASDAQ: LULU) will be one of few retail brands that can survive the Amazon (NASDAQ: AMZN) onslaught, according to one Wall Street firm.

Citi Research raised its rating for the company's shares to buy from neutral, predicting Lululemon will report earnings above expectations this year.

"We believe recent mkt concerns (Amazon, denim, weather) are overblown, and we believe current levels represent an attractive entry point for one of the best performing brands (and long term growth stories) in all of retail," the analyst wrote in a note to clients Friday.

"We have more confidence in both the near and long term trajectory of the brand and its growth potential based on our discussions with management."

Lululemon stock has underperformed the market year to date with its shares down 7.5% through Thursday, compared with the S&P 500's 14.4% return.

The analyst raised his price target for the company's shares to $73 from $62, representing 21.5% upside from Thursday's close.

The analyst downplayed the threat from Amazon due to Lululemon's strong brand and competitive position.

The analyst cited Lululemon's 29 percent e-commerce sales growth in its second-quarter. He also noted the company's large expansion opportunities in Asia.

Also, the analyst raised his fiscal 2017 earnings-per-share estimate for Lululemon to $2.45 from $2.41 compared to the Wall Street consensus of $2.41.

Shares in Lululemon were up $1.63, or 2.7%, to $61.72, in a 52-week range of $47.26 to $72.70.