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On Monday, Jefferies reiterated a Buy rating on Yeti Holdings Inc. (NYSE: NYSE:YETI) with a consistent price target of $55.00, which aligns with the stock’s significant upside potential. According to InvestingPro data, YETI currently trades at $28.96, with analyst targets ranging from $29 to $55, suggesting considerable room for growth. This announcement follows the recent acquisition of Skechers by 3G Capital, with Jefferies drawing parallels between the strategic moves of Skechers and the potential of Yeti Holdings in the current market environment. The acquisition of Skechers (NYSE: SKX) by 3G Capital is set to close in the third quarter of 2025, with Skechers’ current management team slated to continue leading the company.
Jefferies analyst Randal Konik commented on the acquisition, noting that 3G Capital aims to build on Skechers’ growth initiatives, which include product innovation, international expansion, and direct-to-consumer strategies. Skechers has agreed to the acquisition terms, where 3G Capital will pay $63 per share in cash, a 30% premium over Skechers’ 15-day volume-weighted average price (VWAP). Alternatively, shareholders have the option to receive $57 per share in cash plus an equity unit in a new privately held parent company of Skechers.
Konik highlighted that the current economic uncertainty and market volatility have spurred activist campaigns, creating an environment ripe for transformative opportunities similar to Skechers’ privatization. He believes that Yeti Holdings shares similar appeal with its strong cash flow and robust brand presence, positioning it as an attractive target for private equity investment. InvestingPro data supports this view, showing YETI maintains a healthy current ratio of 2.18 and generates substantial free cash flow with a yield of 9%. The company’s strong financial position is further evidenced by its Altman Z-Score of 6.5, indicating very low bankruptcy risk.
The analyst further emphasized Yeti’s potential, stating that the company’s strong brand and multiple growth avenues offer a solid foundation that can withstand market pressures, including tariffs. This assessment is reinforced by YETI’s impressive revenue growth of 10.3% over the last twelve months and a robust gross profit margin of 58.1%. Want deeper insights? InvestingPro subscribers have access to over 30 additional financial metrics and exclusive analysis through the comprehensive Pro Research Report, helping investors make more informed decisions. The ability to manage these pressures through sourcing adjustments and pricing strategies, coupled with expansion into new product categories and international markets, bolsters Yeti’s upside potential.
In summary, Jefferies sees Yeti Holdings as a compelling opportunity, with a combination of limited downside risk and significant potential for share value growth, drawing on the strategic similarities to the recent Skechers acquisition by 3G Capital. According to InvestingPro’s analysis, YETI currently appears undervalued, with strong fundamentals supporting potential price appreciation.
In other recent news, Yeti Holdings Inc. received an updated stock rating from KeyBanc, which upgraded the company from Underweight to Sector Weight despite reducing its earnings estimates for the coming years. The fiscal year 2025 earnings per share (EPS) estimate was revised to $2.35 from $2.86, and the fiscal year 2026 EPS forecast was adjusted to $2.50 from $2.98. Canaccord Genuity maintained its Hold rating with a $35 price target, following Yeti’s launch of the Gold Coast Collection, while Citi reiterated a Buy rating and a $47 price target, based on web traffic data indicating Yeti’s increased share in the hydration sector. Jefferies also maintained a Buy rating with a $55 price target, highlighting Yeti’s recent board appointments as a move to strengthen innovation and global expansion. Additionally, Canaccord Genuity reiterated a Hold rating with a $42 target, noting the positive market response to Yeti’s cooperation agreement with Engaged Capital and the appointment of new directors. These developments reflect a mix of cautious optimism and strategic positioning as Yeti navigates current market challenges and opportunities.
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