UPDATE: Credit Suisse Starts Yeti Holdings Inc. (YETI) at Outperform
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Credit Suisse analyst Kaumil S. Gajrawala initiates coverage on Yeti Holdings Inc. (NYSE: YETI) with a Outperform rating and a price target of $85.00.
The analyst comments "We Expect the Topline to Grow at 15% CAGR through 2025: YETI has thus far achieved success primarily in the US (94% of sales) with a relatively narrow product range (90% coolers and drinkware) and remains underpenetrated in many parts of the country; its international business is also nascent. Moreover, continued expansion into new products and categories (i.e., bags) should attract additional consumers to the brand and grow the addressable market. These factors lead us to believe that growth stories with an expanding addressable market and highly profitable business models (50% ROIC) warrant high multiples. Our $85 target price is based on 30x our 2024E EPS of $3.50, discounted to 2021 at 8%. Risks include early market saturation from narrow product offering; unsuccessful entry into new markets and categories could limit the company’s growth potential; and increased investments behind new product development and new market entry to support growth could put pressure on margins."
Shares of Yeti Holdings Inc. closed at $72.88 yesterday.
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