YETI HOLDINGS INC (NYSE:YETI) – A Potentially Undervalued Stock with Strong Fundamentals

YETI HOLDINGS INC (NYSE:YETI) stands out as an interesting candidate for value investors, according to our fundamental screening criteria. The company, known for its premium outdoor and recreation products, shows a solid combination of reasonable valuation, strong profitability, and healthy financials.

Valuation

YETI’s valuation metrics suggest the stock may be trading below its intrinsic value:

• P/E Ratio: At 11.56, YETI’s P/E is significantly lower than both the industry average (54.66) and the S&P 500 (26.60).
• Price/Free Cash Flow: The stock is cheaper than 83% of its peers in the leisure products industry.
• Forward P/E: At 12.24, it remains attractively priced compared to the broader market.

Profitability

The company excels in profitability, with a perfect ChartMill Profitability Rating of 10/10:

• Return on Equity (ROE): 23.09%, outperforming 90% of industry competitors.
• Operating Margin: 13.30%, ranking in the top 7% of its sector.
• Gross Margin: A healthy 58.18%, reflecting strong pricing power and cost efficiency.

Financial Health

YETI maintains a robust balance sheet, earning an 8/10 in financial health:

• Low Debt: A Debt/Equity ratio of 0.09 indicates minimal reliance on borrowing.
• Strong Liquidity: Current Ratio of 2.58 ensures ample short-term financial flexibility.
• Altman-Z Score: 6.61 signals low bankruptcy risk.

Growth

While growth expectations have moderated, YETI still shows resilience:

• Revenue Growth: 8.38% YoY, with a 5-year average of 14.90%.
• EPS Growth: 12.86% over the past year, though future growth is projected at a slower 4.22%.

For a deeper dive into YETI’s fundamentals, review the full report here.

Our Decent Value screener lists more stocks with strong valuations and solid fundamentals.

Disclaimer

This is not investment advice. Always conduct your own research before making investment decisions.