Is YETI stock a buy? Roth Capital weighs in

After a webinar with management, Roth MKM analyst Matt Koranda came away with some positives on YETI Holdings (YETI Holdings Stock Quote, Chart, News, Analysts, Financials NYSE:YETI) but not enough to move the needle off his “Neutral” rating.

On August 15, Roth hosted CEO Matt Reintjes, CFO Mike McMullen, and VP IR Tom Shaw in a webinar.

“We hosted a webinar with YETI management and came away with positive takeaways. (1) The 4Q soft cooler re-launch appears on track. (2) We think recall accruals are in the rearview (plus gift cards look like upside to 2023 guidance). (3) Management sees several levers to return to 10-15% sales
growth. (4) Most near- to medium-term margin drivers look positive. We’re still at Neutral, as we think investors can be selective on entry points with a choppy macro, but we like the fundamental set-up ahead.

Founded in 2006, Auston, Texas-based YETI Holdings is a consumer brand that sells cooler, drinkware and accessories.

In a research update to clients August 16, Koranda maintained his “Neutral” rating and one-year price target of $46.00 on YETI Holdings, which closed the previous day at $45.75.

Koranda thinks YETI will post EBITDA of $320.5-million on revenue of $2.32-billion in fiscal 2023. He expects those numbers will improve to EBITDA of $365.3-million on a topline of $2.68-billion the following year.

Koranda reiterated that the outlook is most likely bright for YETI.

“Most near- to medium-term margin drivers look positive,” the analyst concluded. “Inbound freight reversal should continue to be a tailwind into 2024 (~600bps overall headwind in 2021/2022, only partly reversed ~300bps as of 2Q23). Product costs are likely either a positive or neutral heading into 2024, and we think channel mix should be positive (given YETI’s stated priority to grow DTC faster than overall sales).”