Analyst downgrades typically lead to a negative short-term reaction in the stock market as they suggest a less favorable outlook for the company. The downgrade from Neutral to Underperform indicates a bearish view on Lululemon's future performance, which could lead to a decrease in investor confidence and a potential drop in stock price. The setting of a price target provides a specific expectation for the stock's future value, which in this case, might be viewed as a ceiling for the stock's potential growth or a reassessment of its current valuation.