As Lululemon struggles with declining sales and lower forecasts, investors find reassurance in Vanguard’s broad-based S&P 500 ETF, which remains near record highs yet offers a low-cost, diversified exposure to the US market’s resilience.
The case for simplicity is hard to ignore when an expensive-looking stock is wobbling. Vanguard S&P 500 ETF, better known as VOO, is trading close to a record high, yet it still offers a cheap way to own a broad slice of the US market. Vanguard says the fund charges an expense ratio of 0.03% and held about $1.76 trillion in net assets at the end of August 2026. Over the past decade, it has delivered a total return of 319%, helped by heavy exposure to large technology groups such as Nvidia, Apple and Microsoft.
That backdrop makes the contrast with Lululemon striking. The yoga and athleisure retailer has lost ground sharply since its latest quarterly update, with the stock slipping further after the company reported a 4% fall in second-quarter revenue, a 9% drop in comparable sales and lower profit. Reuters-style reporting on the results noted that investors also heard a trimmed full-year outlook, which added to concerns that the brand is losing momentum in a competitive premium apparel market.
Some of the weakness appears to be concentrated in the Americas, where sales trends have softened more noticeably. One report on the quarter said revenue came in at about $2.42 billion, comparable sales fell by roughly 10%, and core women’s leggings sales dropped by about 20%. That same report also said earnings per share beat expectations, helped by a tariff refund, underscoring how one-off items can mask deeper demand problems. In other words, the headline earnings figure looked healthier than the underlying trading picture.
By comparison, VOO asks far less of an investor’s judgement. Buying the fund means owning a diversified portfolio of the biggest listed US companies, rather than trying to call the timing of a turnaround at a single retailer. Vanguard’s own data show the ETF’s low cost and broad exposure have made it a long-term compounder, and the current dominance of information technology in the index has only strengthened that case. There are legitimate worries about valuations across the S&P 500, but history suggests that waiting for an index fund to look cheap is often less rewarding than simply staying invested. For investors choosing between a struggling stock and a market-tracking ETF near its peak, the lower-risk answer still looks like the fund.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
