YETI HOLDINGS INC (NYSE:YETI) – A Strong Candidate for GARP Investors

YETI HOLDINGS INC (NYSE:YETI) stands out as a compelling pick for long-term investors seeking growth at a reasonable price (GARP). The company, known for its premium outdoor and recreation products, meets key criteria from Peter Lynch’s investment strategy, balancing solid growth with sound financial health and valuation.

Why YETI Fits the GARP Approach

• Strong Earnings Growth: YETI’s 5-year EPS growth rate of 18.24% reflects consistent profitability, aligning with Lynch’s preference for sustainable growth.
• Attractive Valuation: With a PEG ratio of 0.66 (below Lynch’s threshold of 1), the stock is priced reasonably relative to its growth trajectory.
• Healthy Balance Sheet: A debt-to-equity ratio of 0.09 and a current ratio of 2.58 indicate strong solvency and liquidity.
• High Profitability: The company’s return on equity (ROE) of 23.09% outperforms most peers, underscoring efficient capital use.

Fundamental Strengths

YETI’s financial health is robust, with high marks in profitability (10/10) and solvency (8/10) in our fundamental analysis. Key highlights include:

• Industry-leading margins (gross margin of 58.18%, operating margin of 13.30%).
• Positive free cash flow and a history of share buybacks.
• Revenue growth averaging 14.90% annually over the past five years.

While future growth is expected to moderate, YETI’s fundamentals suggest it remains well-positioned for long-term investors.

For more details, review the full fundamental analysis of YETI.

Our Peter Lynch Strategy screener lists more stocks that fit this strategy and is updated daily.

Disclaimer

This is not investing advice. The observations here are based on data available at the time of writing. Always conduct your own research before making investment decisions.