If you were thinking about heading to your closest Lowe’s store to pick up a new Yeti cooler, you may want to reconsider.
That’s right, Outsiders. Word is being passed down that Yeti will be pulling all of their popular coolers from Lowe’s stores around the nation. The move looks to be part of a big-picture strategy by the luxury cooler maker. They will be cutting down on their wholesale footprint by lessening the number of retail stores they work with. That will also allow them to focus more on their digital audience.
What You Need To Know
- Yeti no longer selling their coolers at Lowe’s
- Yeti is reducing their wholesale footprint and focusing more on digital
- On a product basis, Cowen analysts expect coolers to growth ahead of drinkware
- Cowen and Credit Suisse rates Yeti stock outperform with an $89, and $100 respective price targets
Chief Executive of Yeti Discusses the Decision to Stop Selling at Lowe’s
Matthew Reintjes is the chief executive of Yeti. According to Market Watch, he detailed the company’s decision to stop selling Yeti Coolers at Lowe’s during last week’s earnings call.
“We reduced our independent wholesale footprint to approximately 3,000 target accounts,” he said. “Which we believe helps focus our efforts on very high caliber retail and drive consistent, high-quality experiences for our customers.”
Hopefully, the news doesn’t throw a wrench in your plans to get outside this spring. You may not be able to buy your favorite Yeti cooler at Lowe’s, but they will still be available through the company’s other channels, like their official website. You can still use your smartphone to purchase one.
“As we have evaluated our growth areas, our focus, and optimization mandate, and the current supply constraints, we ultimately believe we can be more productive, better serving our Yeti customers across our strong existing wholesale partnerships, our own direct channels, and our growing international opportunities,” Reintjes said.
Yeti Has All the Makings to be an Outperforming Stock
According to Cowen analysts, Lowe’s name was the latest on “the chopping block.” It’s all a part of their decision to reduce their wholesale footprint. They also rate Yeti as a stock outperform with an $89 price target.
“Management continued its planned withdrawal from certain wholesale partners, notably calling out Lowe’s as a recent name on the chopping block,” Cowen analysts reported. “On a product basis, coolers are expected to lead growth ahead of drinkware with inventory constraints expected to lessen in the second half, particularly for hard and soft coolers.”
Credit Suisse also considers Yeti a stock outperform. However, they say high freight and other costs could intensify in the front half.
“Like others, cost pressures will intensify, particularly in the front half. This will be partly offset by price increases in select SKUs, and SG&A leverage. Importantly, we think pricing will stick, and Yeti’s underlying cost structure is intact outside of inflationary pressures.”
They rate Yeti as a stock outperform with a $100 price target.
“High quality growth story within the consumer space, and one that warrants a premium valuation as well as its ‘rock solid balance sheet.”