Fitbit Reports Solid Q1, Still Plans To Release Smartwatch This Year

Baird Equity Research maintains its Neutral rating on Fitbit Inc FIT Thursday, one day after the wearable device maker reported first-quarter earnings that exceeded expectations.

Baird said quarterly earnings were solid, but uncertainty over the timing of its plans to release a smartwatch required caution.

“Given competitive uncertainties and negative free cash flow, we are maintaining our Neutral rating with a $6 target price,” Baird said. Fitbit was trading at $6.51 at one point on Thursday, up 14.6 percent.

Fitbit is seeking to enter the smartwatch market and compete with Apple Inc. AAPL.

“The company reiterated plans to release a smartwatch later this year, though did not indicate a time frame, with a focus on health and fitness, long battery life and an interactive social component,” Baird said. “While this could open up a new growth vertical, it may also be competing with a new version of Apple Watch.”

At time of publication, shares of Fitbit were up 13.91 percent at $6.47.

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