Lululemon Athletica Inc.'s turnaround won't be quick or easy as the athletic wear company cedes market share to rivals and suffers deepening sales declines, according to BMO Capital Markets, which initiated coverage with an underperform rating.

Analysts led by Kelly Crago say the Vancouver-based company's weak quarterly report and reduced full-year outlook revealed a deeply challenged business. Regional performance is deteriorating across the Americas and China as upstart brands like Alo and Vuori grow in favor among younger consumers.

Crago's $70 price target — the second-lowest on the Street — assumes a roughly 29% decline from where the shares closed on Friday.