Why Is Fitbit Is Better Than Apple Watch? SunTrust's Bob Peck Explains

Bob Peck, SunTrust Robinson Humphrey Internet equity analyst, initiated coverage on wearables maker Fitbit Inc FIT with a Buy rating on Monday.

Peck was on CNBC to explain the reasons behind the Buy rating.

Reasons To Buy

"We like the story for a couple of different reasons," Peck began. "One is there is a huge TAM or total market that's just starting to get penetrated about a $30 billion or so market. And number two, [Fitbit is a] leader by far with an 80 percent market share in the U.S. and a global leader with north of 35 percent share, too."

Related Link: Morgan Stanley, SunTrust Initiate Fitbit With Positive Notes

He continued, "So, just a lot of opportunity to run and that's showing in the financials. So this year you are seeing estimates up almost 90 percent or so in the top line. When you compare that to multiples of 25 times or so, it puts a $50 Fitbit in line with a GoPro or some of the other comps. So we think it's fair."

Fitbit Has Better Brand Recognition Than Apple

Peck was asked to elaborate on the proprietary survey done by SunTrust which demonstrated that the brand recognition of Fitbit is much better than Apple Inc. AAPL's Apple Watch. He replied, "Yeah, it was amazing. It was 3-to-1 and so we asked over almost 2,000 people or so if they have ever heard of any of these different devices and Fitbit had the highest recall, but Apple was right behind it.

"But when we followed up with the question of what percent of you would therefore want to go and buy that unit, Fitbit had over 60 percent share and Apple's fell to 20 percent share."