Lululemon beats, but shares slide as 'what is good enough has become somewhat of a moving target'

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A woman walks past a Lululemon Athletica store in Miami, Florida in 2013.

• Lululemon beat Wall Street estimates on the top and bottom lines.
• Shares fell as much as 7% in after-hours trading Thursday before paring their losses.
• Watch Lululemon trade in real time here.

Lululemon Athletica slid 2% in after-hours trading Thursday after the company reported fourth-quarter earnings that topped Wall Street estimates.

The athletic-apparel retailer reported adjusted earnings of $0.75 a share, topping the $0.69 that Wall Street analysts surveyed by Bloomberg were expecting. Its total third-quarter sales also beat, coming in at $747.7 million versus the $737.4 million that was anticipated.

The company said total comparable sales rose 17%, or 18% on a constant dollar basis. Meanwhile, Lululemon said it expects fourth-quarter earnings per share to be between $1.64 and $1.67. Wall Street analysts were expecting Q4 EPS of $1.65.

"With the market turmoil, sentiment is critical," Simeon Siegel, senior retail analyst at Nomura Instinet, told Business Insider in an email on Thursday.

"LULU posted an objectively impressive result, with strong margins. At its multiple and in this environment, the question around what is good enough has become somewhat of a moving target."

Lululemon was up 73% over the past year.

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Lululemon Athletica shares fall after reporting quarterly earnings.