Fitbit Estimates Raised At Piper Jaffray After Gaining 'Material' Mindshare In New Survey

Fitbit Inc FIT performed well in a teens survey. Piper Jaffray’s Erinn E. Murphy maintained a Neutral rating for the company, while raising the price target from $14 to $16. The analyst cited the reason for the upward revision as improved brand and category traction.

Fitness Tracker Category

Piper Jaffray’s recent Taking Stock With Teens survey showed an “overwhelming positive” response from teens for the wearable category and the Fitbit brand, analyst Erinn Murphy said.

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Overall intent to purchase a fitness tracker had risen from 15 percent last Spring to 22 percent. Overall upper-income ownership had risen to 22 percent for females and 18 percent for males, versus 14 percent and 12 percent in Fall 2015.

The EPS estimates for Q1 and FY16 have been raised from $0.02 to $0.04 and from $1.04 to $1.08, respectively.

Brand Gains Mindshare

Fitbit had 72 percent mindshare in the category, up significantly from 53 percent in Fall 2015. This is well ahead of Nike, which is at No.2 position, at 12 percent mindshare. “Looking at preferred fitness apps, Fitbit moved to No. 1 with 21% (vs. 9% last Spring),” Murphy wrote.

The analyst commented, “We maintain our Neutral rating on shares of FIT as we still need to see more consistent evidence of sell-through of the newer products.”