Market Overview

Morgan Stanley Downgrades Yeti, Says Good News Is Priced In For Now

Share:
Morgan Stanley Downgrades Yeti, Says Good News Is Priced In For Now

Yeti Holdings Inc (NYSE: YETI) is off to a remarkable start in 2019 with shares up 115 percent year to date, but good news may now be priced.

The Analyst

Morgan Stanley analyst Kimberly Greenberger on Friday downgraded Yeti from Overweight to Equal-Weight and raised her price target from $26 to $32.

The Thesis

Greenberger remains constructive on Yeti’s long-term outlook but now sees a more balanced rick-reward scenario. The analyst says she looks to re-upgrade the stock on a pullback.

“The stock has significantly outperformed YTD, driven by significant multiple expansion and slightly better than expected financial performance and now sits 77% above where it IPO'd last October,” Greenberger wrote in a note.

At $32, the stock appears to be pricing in five-plus years of mid-teens revenue growth, and while the analyst sees this as a feasible outcome, the market is already pricing in a majority of Yeti’s potential EBIT margin upside.

Greenberger says two areas where she could be wrong lie in customization and lower tariffs.

Later on in the year, the company is set to combine its main website with YETIcustomshiop.com, to create a stronger customer experience with customize products.

Price Action

Yeti's stock was down 5.14 percent Friday, closing at $30.25 per share.

Related Links:

A Look At Yeti's Competitors

Newell Brands Plunges 14% After Cutting Guidance Again

Photo by Tony Webster/Wikimedia.

Latest Ratings for YETI

DateFirmActionFromTo
Aug 2019MaintainsOutperform
May 2019DowngradesBuyNeutral
Apr 2019Initiates Coverage OnOutperform

View More Analyst Ratings for YETI
View the Latest Analyst Ratings

Posted-In: Kimberly Greenberger Morgan StanleyAnalyst Color Downgrades Price Target Analyst Ratings Best of Benzinga

 

Related Articles (YETI)

View Comments and Join the Discussion!

Latest Ratings

StockFirmActionPT
IINDoughertyAssumes34.0
PNRJefferiesInitiates Coverage On
YYUBSUpgrades
ROKUOppenheimerMaintains155.0
IPHIBank of AmericaMaintains80.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Trading Daily
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com

The Week In Cannabis: SAFE(er) Banking, New Jersey, Seth Rogen, Walgreens And Earnings

A Good Time To Play Defense