YETI Q3 Earnings: Is NYSE:YETI Expensive at 26.8x Price/Book?

in EARNINGS/INVESTING IDEAS by

YETI Holdings, Inc. (NYSE:YETI) is scheduled to report Q3 earnings results before markets open for trading on November 5, 2020.

The company is expected to report earnings of $0.37/share on revenue of $261.9 million. The consensus earnings per share (EPS) of $0.37/share is based on a poll of 14 analysts and represents a growth in eps of 24.1% over the same quarter last year, when the company reported earnings of $0.30/share.

The revenue forecast of $261.9 million based on a poll of 12 analysts implies a year-over-year (YoY) growth in revenue of 14.3%. Last year the company reported $229.1 million in revenue for the quarter.

Expected to report EPS growth of 24.1% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $261.86 $229.13 14.3%
EPS $0.37 $0.30 24.1%

Earnings Call Trends

Management has been great at managing analyst expectations historically. The company has a perfect record over the last 8 tracked quarters of exceeding earnings guidance.

What are your expectations from YETI Holdings, Inc. for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $0.16 $0.41 161.8% Beat
Q1, 2020 $0.04 $0.11 144.4% Beat
Q4, 2019 $0.43 $0.48 12.0% Beat
Q3, 2019 $0.26 $0.30 14.0% Beat
Q2, 2019 $0.30 $0.33 11.1% Beat
Q1, 2019 $0.02 $0.08 222.6% Beat
Q4, 2018 $0.34 $0.38 12.2% Beat
Q3, 2018 $0.21 $0.24 12.9% Beat

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 27, 2020, the stock price reacted by falling −2.4%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
August 6, 2020 $51.63 $50.40 −2.4% Decline
May 7, 2020 $27.26 $29.09 6.7% Increase
February 13, 2020 $34.72 $32.84 −5.4% Decline
October 31, 2019 $34.71 $32.90 −5.2% Decline

The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −2.99, the model suggests that the company is not likely to be an earnings manipulator. A value of −2.99 implies a 0.1% chance of earnings manipulation.

Fundamentals And Technical Analysis

YETI Holdings, Inc. is currently trading at $52.64/share, down −0.8% for the day. The company is trading at approximately 95.5% of its 52-week high of $55.04/share. The company’s stock price is up 4.4% since the last earnings report and up 2.6% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 61.37 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NYSE:YETI Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of 66.61 and a forward P/E multiple of 34.70.

YETI Holdings, Inc.’s current share price also implies a price-to-book (P/B) multiple of 26.80. The following table summarizes some other key fundamental ratios:

Data as of October 28, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 27, 2020
Stock Price (Current) $52.64
P/E Ratio 66.6x
P/E Ratio (Fwd) 34.7x
PEG Ratio 98.2
Total Debt / Total Capital 6.8%
Levered Free Cash Flow $127 million
EV / EBITDA 34.0x

Finbox

YETI Holdings, Inc. is a mid-cap stock with a market capitalization of $4.618 billion and a total enterprise value of $4.827 billion. The company operates in the Consumer Discretionary sector and the Leisure Products industry.

YETI Holdings, Inc. designs, markets, retails, and distributes products for the outdoor and recreation market under the YETI brand. The company offers hard and soft coolers, as well as storage, transport, outdoor living, and associated accessories. It also provides drinkware products, including colsters, lowballs, wine tumbler, stackable pints, mugs, tumblers, bottles, and jugs, as well as accessories comprising bottle straw caps, tumbler handles, jug mounts, and bottle slings under the Rambler brand. In addition, the company offers YETI-branded gear products, such as hats, shirts, bottle openers, and ice substitutes. It sells its products through independent retailers, including outdoor specialty, hardware, sporting goods, and farm and ranch supply stores, as well as through Website. The company operates in the United States, Canada, Australia, New Zealand, Europe, Hong Kong, China, Singapore, and Japan. YETI Holdings, Inc. was founded in 2006 and is headquartered in Austin, Texas.

Expertise: financial technology, analyzing market trends. Brian is a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to research stock fundamentals. Brian’s background is in physics & computer science and previously worked as a software engineer at GE Healthcare. He enjoys applying his expertise in technology to help find market trends that impact investors. Brian can be reached at brian@finbox.io or at +1 (516) 778-6257.

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