Yeti Earnings Skyrocket In Latest Sign That Outdoors Trend Continues; Yeti Stock Rises In Buy Zone| Investor’s Business Daily

Recreational gear maker Yeti Holdings (YETI) reported first-quarter earnings that easily beat estimates early Thursday as consumers continue to head outdoors. Yeti stock rose in a buy zone after tumbling Wednesday.

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The report follows several auspicious signs for Yeti, which is known for its high-end coolers, bags and water bottles.

For instance, retailers of sporting equipment and outdoor gear like Academy Sports & Outdoor (ASO) and Big Five (BGFV) have reported strong earnings recently. In addition, RV sales remain robust. And even golf has seen a resurgence, leading to blowout Callaway Golf (ELY) earnings.

Yeti Earnings

Estimates: Wall Street expected Yeti earnings to jump 91% to 21 cents per share, according to Zacks Investment Research. Revenue was seen increasing 26% to $220.27 million.

Results: Yeti earnings exploded 245% to 38 cents a share. Revenue grew 42% to $247.6 million. Direct-to-consumer sales jumped 59% to $126.8 million.

Drinkware sales increased 32% to $148.9 million. Cooler and equipment sales surged 57% to $93.5 million.

Outlook: Yeti now sees adjusted EPS of $2.28-$2.32 vs. its February target of $2.11-$2.14, with the Q1 beat of 17 cents largely accounting for the raised forecast. Analysts expected $2.16. The company targets 20%-22% revenue growth vs. its prior goal of 15%-17%.

Yeti Stock

Yeti stock rose to 84.23 soon after the open and quickly fell to 78.64, finding support at the 50-day line. Shares are now up 1% to 82.26 in the stock market today. On Wednesday, the IBD 50 stock moved back into a buy zone, which tops out at 85.49. Yeti stock cleared an 80.99 buy point in mid-April and an alternative 76.87 handle entry before that, according to MarketSmith chart analysis. The relative strength line has flattened out after rising sharply for most of 2020.

Among shares of other outdoor gear makers, Vista Outdoor (VSTO) rose 2.5% Thursday morning, and American Outdoor Brands (AOUT) climbed 2%.

Yeti makes trendy and pricey coolers and drinkware, popular with outdoor enthusiasts. Its coolers range in price from $80 for personal-sized ones to $1,200 for larger varieties. Yeti is expanding its presence in another market — luggage, including duffels and backpacks for adventure seekers.

The company continues to benefit from growth in online shopping during the pandemic. Consumers, stuck at home as movies and restaurants slowly reopen, continue to head outdoors for recreation. Strong direct-to-consumer sales underpinned recent Yeti earnings, up 62% in Q3 of last year and up 46% in Q4.

Find Aparna Narayanan on Twitter at @IBD_Aparna.

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