Lululemon (LULU) announced earnings this morning and it wasn’t pretty.  The company posted better than expected third quarter earnings, but projected comparable sales in the final quarter of the year will be flat.  As a result, the stock is down over 9% in pre-market trading, hovering in the low $62s.

I’m still a LULU believer though and I think the dip may present a buy opportunity (at least for a short-term play).  Even though the stock dropped, 3rd quarter revenue did extremely well. Net income for Q3 was $66.1 million, or 45 cents a share, compared to $57.3 million, or 39 cents a share, last year.  Analysts expected Lululemon to post earnings of 41 cents a share.  Q3 revenue increased 20% to $379.9 million from a year ago, higher than analysts’ predictions of $376 million. Finally, comparable-stores sales increased 5% from last year.

Another strong indicator from LULU is its sales per square foot.  LULU has the 3rd highest sales per square foot among retailers (over $2000/sq ft), behind only Apple and Tiffany.

Finally, Lululemon’s new leadership may be a positive change for the company.  It recently announced a new CEO, Lauren Potdevin, who was most recently at Toms shoes.  And the founder and chairman stepped down after some insensitive comments.

The reason I’m comfortable buying on the dip is that for every quarter I’ve been following LULU earnings it’s dropped.  Not matter how much LULU beats earnings, the market always seems to react negatively and then correct itself.  I may buy now and wait for the stock to rise at least a few points to the mid-high $60’s over the next week.

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