YETI

Bought in at 16.5 and 19 its been bulldozing ever since currently sitting in the 35 range. Recently increased their sales and EPS guidance  by 20% for FY 2019 with next ER in May... smallcap(2.3B) with seemingly tons of runway....trades around 50x which is not to exorbitant for a high growth company. Thinking of selling 1/3 and letting the rest run...good idea? 

50x for their industry is absurd as the peer average is in the mid to high teens. Growth is good but they will get knocked off left and right. You get no dividend and when the inevitable hiccup in growth occurs it will retrace. I would count my blessings and cash out. 

I'm hesitant to cash out 100% as shes a young fast growing company so hopefully the inevitable hiccup is a ways down the road....cashed out to early with VEEV(  although did re-enter at 118) and trying to avoid making the same mistake again. 

https://www.msn.com/en-us/money/topstocks/yeti-stock-is-a-great-trade-but-not-a-fantastic-investment/ar-AAAJDj3

The above is an interesting article on Yeti written today on Investor Place. It basically reinforces what I said a few days ago. Ozark Trail has already knocked off several of the Yeti product line at roughly 1/4 the retail cost with equal performance.....it's not rocket science after all.  

I do get that part of the story for Yeti is in their branding and image building, but as an investor I would be concerned about long term profits in a business where the competition makes the same products and sells them for 25% of the cost. In the short term, that does translate to more money in Yeti's pockets.....and thus in investor's pockets.....but that can only last so long.

WalMart sells the Ozark Trail tumblers and coolers for MUCH LESS and that competition has already driven prices down on the YETI product line. I remember when the coolers were introduced they were selling for $299 and up. These days you can find them for under $200. I can assure you that margins will be shrinking, not growing.....and it will happen faster than you think.

So I sold half of my position at 36.16 pre ER...

Great article thanks for posting. I'm thinking Yeti will only get better at branding their products over time. Knockoffs are part of the deal when you're a premium brand so no big surprise there.

So YETI in process of dumping 9.5 million share on the market  helping push the stock from36.5 to25.5  to say I'm happy dumping 1/2 my position at36.16 is the understatement of the month....got a buy order in at22.5 as the bull.thesis is still intact in my opinion.

I'm glad you got out of that full position and took profits. I warned you about that 50x valuation. That was a crazy number.....it just couldn't hold. Honestly, even at its current 36 p/e I would run for the hills. This business has limited barriers to entry and I am already seeing new competitors that I have never heard of pop up on the shelves next to the Ozark Trail line. This business is far from rocket science.

I don't see YETI as something I want in my portfolio as a long term hold. 

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