Jefferies bullish on outdoor product maker Yeti as its beach bag gets big on TikTok

Jefferies is bullish on Yeti Holdings, a small-cap company that makes outdoor recreation products. In particular, it appreciates the TikTok success of its new beach bag and expects Yeti's market value to grow by a third.

Boosting Yeti's stock is excitement around its Camino Carryall Tote beach bag, which has picked up a big following on TikTok, said Jefferies analyst Randal Konik. Yeti jumped 4.9% to $39.70 per share yesterday, July 23, and has continued to rise in today's premarket trading as of this writing. In just the last month, Yeti's market value has increased more than 30%. 

Social media users are calling the product "the beach bag of the summer" and showing off how they decorate theirs with scarves, bows, and more. The middle-sized model costs $150.

The Jefferies analyst sees the tote’s “viral” moment as an indicator that Yeti is doing things right as it broadens its business. Yeti is perhaps best known for coolers and water bottles, but Konik notes that executives have made bags “a key growth pillar.”

Konik has a $53 per share target price on Yeti, for upside of 33% versus the last close. He is upbeat on the company's financial position and its cash flow, which he estimates could exceed $1 billion cumulatively from 2024 to 2028.

He believes the company can grow through international expansion, noting strong performance in Canada and Australia, as well as newer efforts to make inroads in Asia and Europe. The company is launching in Japan this quarter and focusing on Germany and the U.K. in Europe, Konik adds. In the first quarter, international sales were $79.8 million, for a 22% share.  

Yesterday, Citi raised its target price on Yeti to $44 per share from $36 per share, reiterating its "buy" recommendation. The upgrade followed an analysis of web traffic data, which showed that while competition from other hydration brands existed, traffic to yeti.com improved in the second quarter.

Meanwhile, of the 18 Wall Street analysts who cover the company, only six have it as a "buy," with the other 12 rating it a "hold," according to MarketWatch data. 

Investor's Business Daily writes that Yeti stock ranks third in the "Leisure Products" industry group. 

Yeti sells premium leisure products. Its biggest revenue stream is its Rambler-branded stainless steel travel mugs and bottles. In the first quarter of this year, they accounted for $205 million of the $351 million in sales. 

Yeti has been particularly hard hit by Trump's tariffs because its manufacturing is based in China. It has had to selectively raise prices, executives said on the first-quarter earnings call. But the main mitigation tactic is supply chain relocation, with supplier support also helping manage the rising costs. The CEO expects that 90% of Yeti's U.S. drinkware capacity to be ex-China by the end of the year. 

On July 16, investment firm Stephens disclosed it had purchased 73,200 shares valued at approximately $2.42 million during the first quarter, a move that indicates fresh institutional confidence in the brand and may signal a positive outlook on the stock's future performance, writes StockStory. 

The AI translation of this story was reviewed by a human editor.