Hedge Fund News Wrap: Week Ending 09/11/15

A Sour Squeeze For Lululemon

(The Motley Fool) – The company that essentially invented the “athleisure” clothing trend is now treading water after falling nearly 16% Thursday morning. Lululemon released their fiscal second-quarter financial report, which included a revenue growth of 16% on an 11% rise in total comparable sales. The drop came as the yoga-apparel giant said that its fiscal-third-quarter earnings are expected to fall by as much as a sixth from year-ago levels. 
Even with the drop, the company is in good spirits with the holiday season coming up. “Our momentum continues to build,” said CEO Laurent Potdevin in a statement.

Lululemon has had their share of recalls and bad publicity, but recently they have a developed a new way to sell their yoga pants, by “sensation.” Hopefully the unique selling points will help the company rise into the green once again.

Read the entire article at The Motley Fool
More coverage: Forbes and Fox Business

GoPro is a GoNo.

(Fortune) – GoPro is down 40% in the last month and is currently trading within 10 cents of the company’s IPO release in June of 2014. Although the head-wearing-camera company posted a strong second quarter, earning $419.9 million in revenue and a $35 million profit, things are not looking up.

The question seems to be whether or not the stock has peaked, and if this niche product is no longer the cool kid on the block that it was for a short while. More bad news is in store as Ambarella, the company which produces the image processing chip inside of the camera, stated that it is expecting a decline in year-over-year revenue for the quarter that ends in October.

Read the entire article at Fortune
More coverage: Yahoo Finance and The Street

Imagine A Performance Guarantee Or Your Money Back

(Business Insider) – A radical and unusual method is in use at the biggest stock-focused hedge fund in the world and it has the financial world buzzing. Adage Capital Management LP, a $28 billion Boston-based hedge fund will refund its investors if the fund misses the mark.

Traditionally, hedge funds collect 20% of investor’s profits, but Adage has a smaller management fee than most. Robert Atchinson and Phillip Gross, two Harvard endowment executives, have developed a system in which contrast charges are only 0.5% for assets under management and takes 20% profits if, and only if, it beat the S&P 500.

The fund must be doing some right, as it has doubled in size over the past four years and is currently one of the world’s 10 largest hedge funds. So far 2002 and 2008 have been the only years where investors received a refund, but 2015 might be next as the firm has underperformed the S&P 500 through August. Currently down 3.53% through the end of August, the next couple of months could end in the firm handing out the largest refunds in its history.

Read the entire article at Business Insider
More coverage: Time and Wall Street Journal