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YETI Stock Study (10-21-25)

Posted by on January 2, 2025 at 07:16 | Last modified: October 21, 2025 10:42

I recently did a stock study on YETI Holdings (YETI, $33.99). Previous studies are here, here, here, and here.

M* writes:

     > YETI Holdings Inc is a designer, marketer, and distributor of
     > premium products for the outdoor and recreation market sold under
     > the YETI brand. The company offers products including coolers and
     > equipment, drinkware, and other accessories. Its trademark products
     > include YETI Tundra, Hopper, YETI TANK, Rambler, Colster, Rambler
     > among others. The company distributes products through wholesale
     > channels and through direct-to-consumer, or DTC, channels.

Since 2018 when this medium-size company begins public trading, sales and earnings have grown at annualized rates of 15.9% and 20.2%, respectively. Lines are up and somewhat parallel due to EPS dips in ’19 and ’22 [latter due to operational snafus including recall of defective items and inflation-induced demand destruction per Value Line (VL)]. 5- (10-) year EPS R^2 is 0.00 (0.49) per BI website and VL gives an Earnings Predictability score of 75.

Since 2018, PTPM leads peer and industry averages while ranging from 7.3% in ’22 to 19.0% in ’21 with a last-5-year mean of 14.3%. Over the last six years, ROE also leads peer and industry averages despite falling from 57.3% in ’19 to 22.1% in ’24 with a last-5-year mean of 36.3%. Debt-to-Capital is less than peer and industry averages in falling from 91.9% (’18) to 18.9% (’24) with a last-5-year mean of 25.4%.

Quick Ratio is 1.32 per M* and Interest Coverage is 241 per Barchart.com. M* also assigns a “Narrow” Economic Moat and gives a B grade for Financial Health (per BI website). VL gives a B for Financial Strength.

With regard to sales growth:

My 1.0% forecast is near bottom of the range.

With regard to EPS growth:

My 3.0% forecast is below the long-term-estimate range (mean of four: 6.3%). Initial value will be ’24 EPS of $2.05/share rather than 2025 Q2 EPS of $2.10 (annualized).

My Forecast High P/E is 25.0. Since 2018, high P/E ranges from 25.0 in ’24 to 80.6 in ’22 with a last-5-year mean of 44.2 and a last-5-year-mean average P/E of 31.6. I am at bottom of the range.

My Forecast Low P/E is 13.0. Since 2018, low P/E ranges from 8.6 in ’20 to 27.0 in ’22 with a last-5-year mean of 19.0. I am forecasting below all but ’20.

My Low Stock Price Forecast (LSPF) of $26.60 is default based on initial value given above. This is 21.7% less than the previous close and equal to the 52-week low.

These inputs land YETI in the BUY zone with a U/D ratio of 4.1. Total Annualized Return (TAR) is 13.6%.

PAR (using Forecast Average—not High—P/E) of 6.9% is less than I seek for a medium-size company. If a healthy margin of safety (MOS) anchors this study, then I can proceed based on TAR instead.

To assess MOS, I start by comparing my inputs with those of Member Sentiment (MS). Based on only 21 studies (my study and 7 outliers excluded) over the past 90 days, averages (lower of mean/median) for projected sales growth, projected EPS growth, Forecast High P/E, and Forecast Low P/E are 5.4%, 6.6%, 25.0, and 15.5, respectively. I am equal to (high P/E) or lower across the board. VL’s projected average annual P/E of 15.0 is lower than MS (20.3) and lower than mine (19.0).

MS high / low EPS are $2.89 / $2.08 versus my $2.38 / $2.05 (per share). My high EPS is less due to a lower growth rate. VL’s $4.00 soars above both.

MS LSPF of $26.30 implies a Forecast Low P/E of 12.6: less than the above-stated 15.5. MS LSPF is 18.4% less than the default $2.08/share * 15.5 = $32.24 resulting in more conservative zoning. MS LSPF is also 1.1% less than mine.

I believe MOS is robust in this study because my inputs are near or below respective analyst/historical ranges and MS averages. MS TAR (14.5%) is 0.9% per year greater than mine.

With regard to valuation, PEG is 2.0 and 5.2 per Zacks and my projected P/E (low growth rate) with the latter extremely overvalued (M* is undervalued at 0.74). Relative Value [(current P/E) / 5-year-mean average P/E] is quite cheap at 0.51.

Per U/D, YETI is a BUY under $36. BI TAR criterion is met ~ 64.2 / ((14.87 / 100 ) +1 ) ^ 5 = $32 given forecast high price ~$64 (no dividend).

Full disclosure: I currently own YETI shares.

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