Baird Analyst Thinks 'There Are More Good Times Ahead' For FitBit
Fitbit Inc (NYSE: FIT) stock has doubled since its IPO last month and according to William Power, analyst at Robert W. Baird, it's going to continue to move higher. Power recently initiated a coverage on the stock with an Outperform rating and $52 price target.
More Good Times Ahead
"The stock...has certainly had a good move since the IPO, priced to $20 open at $30, it has moved since," Power began. "But look, I mean this is a company that's in a unique position. They are a leader in the wearable space. Really the only pure play, publicly traded opportunity that has had tremendous growth.
Look at the last two quarters, each of those quarters they have grown the top-line close to 200 percent and we think there are more good times ahead of them."
Related Link: Why Apple Watch's 90% Sales Decline Isn't A Big Deal
Apple Watch Will Be A Bigger Competitor Overtime
Power was asked about the competition that FitBit devices face from the Apple Watch. He replied, "I think longer term, Apple Watch will continue to become a bigger and bigger competitor.
That said, right now this is an overall secular trend that I think presents opportunities for both companies and you got to look at Apple Watch, it really is trying to appeal to a broader segment of the market whereas FitBit is really much more fitness oriented."
"And when you look at their average ASP, it's close to $80 and while rising that's well below where Apple Watch comes out at probably $400 plus. So, I guess it's a combination of segmenting the market and both benefiting from what are strong secular fitness trends," Power said.
© 2016 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.