YETI Holdings, Inc.: Initiation of Research Coverage

Monday, November 19, 2018

William Blair & Company initiated research coverage of YETI Holdings, Inc. (YETI $16.89), a lifestyle brand of premium high-performance outdoor and recreational products, with a focus on exceptional performance and durability.

Analyst Sharon Zackfia expects the company will achieve 10% to 15% top-line growth and 20% earnings per share growth annually. She forecasts Yeti will record revenue of $765 million in 2018, $857 million in 2019, and $965 million in 2020; and EPS of $0.66 in 2018, $0.78 in 2019, and $0.97 in 2020.

“Yeti is a premium lifestyle brand with broadening appeal,” Zackfia said. “With its roots in hard coolers, Yeti has expanded into soft coolers, drinkware, and other products—all of which sport lower price points than its heritage product and contribute to greater brand relevancy. Despite strong top-line growth, Yeti’s unaided brand awareness remains low at 10%, and we expect the company to increase its marketing budget over the next few years, with its first national ad campaign launching in the current quarter. Yeti’s brand awareness and sales are lowest in areas with high population densities, such as New England and the West Coast, which represents a good opportunity to increase sales. Yeti also has significant international revenue potential from just 2% of sales, versus 20%-plus for its peers.”

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William Blair or an affiliate was a manager or co-manager of a public offering of equity securities of YETI Holdings, Inc. within the prior 12 months.

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William Blair or an affiliate expects to receive or intends to seek compensation for investment banking services from YETI Holdings, Inc. or an affiliate within the next three months.

William Blair or an affiliate received compensation for investment banking services or non-investment-banking services from YETI Holdings, Inc. within the last 12 months. YETI Holdings, Inc. is or was, within the last 12 months, an investment banking client of William Blair & Company and/or one or more of its affiliates.

Officers and employees of William Blair or its affiliates (other than research analysts) may have a financial interest in securities of YETI Holdings, Inc.

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Current Ratings Distribution (as of 11/16/18)

Coverage Universe
Outperform (Buy): 66%
Market Perform (Hold): 33%
Underperform (Sell): 1%

Inv. Banking Relationships*
Outperform (Buy): 22%
Market Perform (Hold): 8%
Underperform (Sell): 0%

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