Yeti Holdings (YETI – Research Report), the Consumer Cyclical sector company, was revisited by a Wall Street analyst yesterday. Analyst Brian McNamara from Canaccord Genuity maintained a Hold rating on the stock and has a $41.00 price target.
Brian McNamara has given his Hold rating due to a combination of factors that have impacted Yeti Holdings’ performance and outlook. The company reported weaker-than-expected results for Q4, with sales falling short of both Canaccord Genuity’s and consensus estimates. The demand for higher-priced items, specifically coolers, has seen a decline, which the management attributes to a shift in consumer spending patterns. Despite a positive surprise in gross margin, Yeti’s operating margin and adjusted EPS did not meet expectations. Additionally, competitive pressures, particularly from Stanley in the drinkware segment, have raised concerns about future growth, leading to a revised price target of $41 from the previous $50.
The forward-looking guidance provided by Yeti for FY2024 suggests sales growth in line with expectations, but profitability forecasts fall short. The cautious stance reflects the current macroeconomic uncertainties, yet there is potential for growth through brand expansion and innovation. Internationally, the brand witnessed significant growth, and there are plans to further develop its omni-channel presence and wholesale growth. Despite these positive aspects, the challenges in the cooler segment, where consumers are showing resistance to high prices, and the potential diminishing impact of the competitive ‘halo’ from Stanley in drinkware, contribute to the rationale behind McNamara’s Hold rating.
In another report released yesterday, Morgan Stanley also maintained a Hold rating on the stock with a $46.00 price target.
YETI’s price has also changed slightly for the past six months – from $45.750 to $41.530, which is a -9.22% drop .
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Yeti Holdings (YETI) Company Description:
YETI Holdings, Inc. engages in the design, marketing, and distribution of products for the outdoor and recreation market. Its products include coolers, drinkware, travel bags, backpacks, multipurpose buckets, outdoor chairs, blankets, dog bowls, apparel, and accessories. The company was founded by Roy J. Seiders and Ryan R. Seiders in 2006 and is headquartered in Austin, TX.
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