Bullish Raymond James Appreciates Yeti's 'Impressive' Earnings Pre-Announcement

Shares of premimum cooler maker Yeti Holdings Inc YETI were soaring Monday in reaction to an encouraging preliminary fourth-quarter announcement.

What Happened

Yeti said in a press release that net Q4 sales rose 19 percent year-over-year to $241.2 million, while direct-to-consumer sales increased 45 percent to $110.5 million and wholesale sales rose 4 percent to $130.7 million. By segment, drinkware sales rose 24 percent to $143.5 million, while coolers and equipment sales rose 10 percent to $91.2 million.

Why It's Important

Yeti's pre-earnings announcement was "impressive" and highlighted by an "especially strong" performance in the drinkware segment, which outperformed expectations for 9-percent growth, Raymond James' Dan Wewer said in a research report. The company also benefited in the quarter from new product launches like dog bowls and chairs, the analyst said. 

Raymond James has an Outperform rating on Yeti with a $19 price target. 

What's Next

Looking forward to fiscal 2019, Yeti is expected to see 12-percent sales growth due to the brand's continued momentum, new product categories and continued expansion in the direct-to-consumer business, Wewer said. 

Yeti's strong quarter comes at a time when the stock is still trading at a discount to its peers at 11.1 times 2019 estimated EV/EBITDA, which is 31 percent below the comparable universe average, according to Raymond James. 

Yeti shares were rising 9.69 percent to $18.29 at the time of publication Monday. 

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Photo by Tony Webster/Wikimedia.