Yeti, like Nike, experienced a shutdown at a Vietnamese production facility due to COVID


Yeti Inc. said a manufacturing facility in Vietnam has closed, adding to the long list of supply chain issues consumer businesses have had due to COVID-19.

“Recently, we have seen the government-ordered shutdowns of one of our soft cooler suppliers in Vietnam due to the ongoing impact of COVID,” said Matt Reintjes, chief executive officer of the outdoor cooler and accessories company, during its biggest recent earnings call, according to FactSet .

“While our previous work in promoting supplier redundancy in key product areas has helped us absorb this type of temporary interruption, the shutdown underscores the inherent volatility that persists around the world.”

During the fourth quarter of fiscal year results in June, Nike Inc. NKE,
discussed the closings in Vietnamese factories making their shoes due to the spread of COVID-19.

See: Nike production in Vietnam is stalling due to COVID-19, adding another challenge to the supply chain

This is just one of many supply chain hurdles consumer businesses face during the back-to-school and holiday season. Finding containers and trucks to move items was among the other problems businesses faced.

Still, Yeti YETI,
reported results for the second quarter that exceeded expectations.

Net income was $ 56.2 million, or 63 cents per share, compared to $ 33.5 million, or 38 cents per share, last year. Adjusted earnings per share of 68 cents exceeded the FactSet consensus of 56 cents. Revenue of $ 357.7 million was over $ 246.9 million a year ago and was also above the FactSet consensus of $ 328.5 million.

Yeti expects sales to increase between 26% and 28% for the full fiscal year, compared to the previous forecast of 20% to 22%. Earnings per share are projected to be between $ 2.25 and $ 2.29, down from $ 2.12 and $ 2.16. And adjusted earnings per share is now projected to be between $ 2.42 and $ 2.46, compared to the previous outlook of $ 2.28 and $ 2.32.

The FactSet consensus assumes revenue of $ 1.396 billion, a growth of 27.8% and earnings per share of $ 2.47.

Likewise: Santa Claus could stall as supply chain problems put the toy sector at risk for the holidays

“Yeti delivered another stellar quarter of performance, overcoming supply chain headwinds (including the closure of a soft cooler supplier in Vietnam) to build inventory to a robust 2H: 21,” Cowen analysts wrote in a note.

Cowen rates Yeti stock above average with a target price of $ 118.

“Momentum and implementation through a challenging supply chain and logistics environment remain impressive, and scarcity will help brand heat and visibility into 2022,” the Stifel analysts wrote in a note.

Stifel rates Yeti shares with a price target of $ 100.

“In our entire coverage universe, Yeti remains one of the more resilient top-line growth stories, and in our follow-up with management we got away with it with a feel.”
that management has a high level of trust, that strong double-digit sales
Growth can also be achieved beyond this year, ”writes UBS in a press release.

UBS gives Yeti shares a neutral rating with a price target of USD 112.

Do not miss: Amazon’s supply chain is almost at full capacity and is influencing some key decisions, experts say

Raymond James is optimistic about the company’s outlook.

“The company has decided to raise its forecast for 2021 for the second time, which reflects the sales growth in the second half of the year above its long-term target and despite difficult comparisons and an improved EPS outlook,” write analysts led by Joseph Altobello.

“We continue to believe that the stock’s premium valuation is warranted given Yeti’s recent track record of healthy and steady growth and the potential for further upside to our estimates that comes with a rock-solid balance sheet.”

Raymond James rates Yeti stock above average with a target price of $ 111.

The Yeti share is up 49% over the year to date, far outperforming the 18.2% growth of the S&P 500 SPX index.


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