The former Azzurri boss feels the Bianconeri could have gone all the way in the competition last term, but were unfortunate to draw Bayern Munich in the quarterfinals.
Antonio Conte's men were defeated 4-0 on aggregate by Bayern Munich in the quarterfinals of the tournament last term, with the Bavarians going on to win the tournament.
The former Juve boss - who lifted the Champions League with the club in 1996 - feels the luck of the draw was against the Bianconeri, but believes they are capable of winning the trophy this season if fortune works in their favor.
"[Conte] has a strong team but winning [the Champions League] depends on several factors, including luck, which does not play a secondary role," the 65-year-old told the Corriere dello Sport.
"If last year they didn't meet Bayern in the quarterfinals, they could have reached the final."
Furthermore, the trainer believes the Bianconeri are in a favored position to secure their third title in a row this term.
"All the teams that win Serie A are considered favorites the following season," he said. "Juve have a winning mentality, the right belief and strengthened themselves with new signings.
"Winning the league is difficult, it is harder to win back-to-back titles and winning it the third consecutive year even more so."
Regarding the club's new signings Carlos Tevez and Fernando Llorente, Lippi is confident they will strengthen the squad, but also remarks they have to prove their worth in Serie A.
"I think Tevez is a great signing, he will add value and Llorente can be the player Juve have missed out on from a technical aspect.
"However, both are foreigners and have to prove their worth in Italy."
Lippi led Italy to World Cup glory in 2006 before leaving his post in charge of the national side in 2010 and joining Chinese outfit Guangzhou Evergrande.