Price consolidation with earnings ahead, great fundamentals!
Over the last five years, the company has experienced rising revenues, though growth began to decelerate in FY 2022. Quarterly revenue data from 2023 and 2024 indicates that FY 2024 will achieve at least a 10% year-over-year revenue increase. YETI's revenue is typically seasonal, peaking during the holiday season. FY 2023 revenues were impacted by a voluntary product recall, which was completed before FY 2024 began.
Currently, YETI is trading at over one standard deviation below its two-year average P/E ratio, at approximately a 16% discount from historical averages, with an implied stock value in the range of $43.06 to $49.05 per share.
The company is largely equity-funded and has a $300 million credit line based on SOFR. As of Q2 2024, it pays 7.3% on $80 million of debt, and its cash-to-debt ratio is greater than one, indicating no need for additional capital to cover all debt obligations.
Since August 2022, insider purchases have far exceeded insider sales, with 468,637 shares acquired at an average cost basis of $39.24 per share. The current stock price is below this cost basis, highlighting the stock's discount. The significant volume of insider buying relative to sales further underscores this discount. Additionally, YETI is authorized to repurchase $300 million in stock in FY 2024.
Four hedge funds hold substantial positions in YETI, with each either adding to or establishing new positions in 2024. Their cost basis for these holdings ranges from $38.58 to $42.49.
I recommend a BUY rating for YETI, with a target price of $46.89. The current stock price is trading below all analyst recommendations and below the average hedge fund cost basis, making it an attractive value buy.
This post was rephrased with chatGPT, but is my work. All data is supported by research with a different software.
Currently, YETI is trading at over one standard deviation below its two-year average P/E ratio, at approximately a 16% discount from historical averages, with an implied stock value in the range of $43.06 to $49.05 per share.
The company is largely equity-funded and has a $300 million credit line based on SOFR. As of Q2 2024, it pays 7.3% on $80 million of debt, and its cash-to-debt ratio is greater than one, indicating no need for additional capital to cover all debt obligations.
Since August 2022, insider purchases have far exceeded insider sales, with 468,637 shares acquired at an average cost basis of $39.24 per share. The current stock price is below this cost basis, highlighting the stock's discount. The significant volume of insider buying relative to sales further underscores this discount. Additionally, YETI is authorized to repurchase $300 million in stock in FY 2024.
Four hedge funds hold substantial positions in YETI, with each either adding to or establishing new positions in 2024. Their cost basis for these holdings ranges from $38.58 to $42.49.
I recommend a BUY rating for YETI, with a target price of $46.89. The current stock price is trading below all analyst recommendations and below the average hedge fund cost basis, making it an attractive value buy.
This post was rephrased with chatGPT, but is my work. All data is supported by research with a different software.
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