Here’s How We Made 150% Gains in YETI

Apr 03, 2021

Last May, we spotted an enormous opportunity.

Consumers were trading in plane tickets for the shotgun seat.

Road trip mentions surged as consumers sought Vitamin D and entertainment outside the confines of their homes.

And one name was showing serious strength.

Any guesses what company we spotted as a MAJOR beneficiary of increased outdoor recreation and patio sipping, well before the market had any idea?

If you guessed Yeti, you’d be correct. (And also, you’re our kind of people).

YETI Demand was Ramping a Year Ago

Check out consumer demand for Yeti cooler and drinkware products heading into summer 2020: pushing through multi-year highs.

Since we featured this chart in a Bullish Opportunity Alert, shares surged by more than 150%!

In fact, YETI is still trading within 10% of its highs.

What Does YETI Demand Look Like Now?

Now it’s time to ask ourselves — can these gains continue?

Based on real-time consumer insights, we’re not so sure.

Demand for Yeti products is waning, currently pacing 35% lower YoY.

This is shaping up to be a classic case of divergence… when the market expects one thing, but consumer demand suggests the complete opposite.

Now let’s poke holes in our theory.

We know that Yeti’s successful pivot to Direct-to-Consumer (DTC) offerings helped bolster the company in the last quarter (+50% YoY).

Its direct-channel mix now comprises almost 60% of total revenue.

So, what does Yeti’s digital landscape look like since its last report?

Not great.

After a noted bump over the Holiday season, digital purchase intent mentions are pacing -15% lower YoY on a 30-day moving average.

It makes us wonder — just how many Yeti Tundras does the average consumer need?

Maybe that’s why Yeti rolled out a new merchandise line in February.

Product launches are something we’re always tracking in companies we cover, but so far this doesn’t appear to be moving the needle for the YETI… yet.

To be fair: Yeti is a customer favorite. Consumer Happiness remains extremely high: 77% positive.

But growth has dissipated.

If you’re still in YETI, now may be a great time to consider taking sizable profits. And if you’re not, maybe take a breather on this name.

In the meantime, we’ll be monitoring for developments. This real-time insight is what gives traders a LikeFolio edge.

Andy Swan,
Founder, LikeFolio