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Yeti Gets Ready to Go Public

Written by Monica Savaglia
Posted October 22, 2018 at 8:00PM

It’s finally starting to feel like fall here in Baltimore. In the past few weeks, we’ve been feeling the temperatures drop and adjusting to the cooler weather. When it was the beginning of October and the highs were in the upper 80s, I was convinced fall would never start.

You can lump me in with all the other people who have grown to love this season. I’m not ashamed for my love of fall. Especially fall in Maryland, with the changing of the leaves and the cooler temperatures. I’ve always been a fan, but summer also holds a special place in my heart.

I love going to the beach and relaxing on a boat that’s cruising around the Chesapeake Bay. And this summer seemed exceptionally longer than usual. It meant I could spend more time near some type of body of water with all of my friends. And of course, no group outing in the summer would be complete without some cold beverages.

It was this summer when I started to notice most of my friends owned a lot of the same coolers. I'd never seen them before. I was impressed by the design of these coolers. They seemed sturdy but were visually appealing as well. Not only that, but they actually kept cold beverages cold.

Once I was introduced to these coolers, I realized the company sold more than just coolers — it also made drinkware. I ended up seeing this company's products everywhere. I saw them at stores, at my coworkers’ desks, at my friends’ houses. The company bringing these products to the hands of almost all my friends is called Yeti.

Have You Heard of Yeti?

That’s when I started to do some research on the company, learning more about its products and history. The company is currently private and is headquartered in Austin, Texas. It was founded in 2006 by brothers Roy Seiders and Ryan Seiders.

These brothers are avid outdoorsmen and started the company because they were frustrated that their equipment wasn’t meeting their needs for hunting and fishing. So they took their knowledge and developed a nearly indestructible hard cooler with superior ice retention.

Yeti sells its products in over 6,000 retailers, including West Marine, Bass Pro, Cabela's, REI, and Dick's Sporting Goods. While it may seem like the market Yeti aims for is a little niche — a market that includes high-end hunting and fishing enthusiasts — it has created dedicated consumers willing to buy its products at whatever cost.

Yeti sponsors professional hunting and fishing shows, ensuring those markets that its products are reliable. These types of consumers tend to be repeat buyers. They have brand loyalty, so when a new product line comes, you can almost guarantee those consumers will buy.

The company is making living an active lifestyle more enjoyable, and that has been creating a following of people who are passionate and loyal to the brand.

Its customer base continues to expand. From 2015 to 2018, Yeti reported that its customer base has evolved from 9% female to 34% and from 64% aged 45 and under to 70%.

From 2015 to 2017, the company has experienced 243% growth. It’s obvious Yeti is growing and has the opportunity to further expand in the United States and even globally.

With Yeti’s recent growth and dedicated customer base, the company has decided to go public. It plans to make its initial public offering (IPO) this Thursday, October 25th.

Yeti Prepares for its IPO

This is the second time the company has thought about going public. It filed its IPO paperwork back in July 2016 and withdrew from its initial filing on March 23rd. But I think this go-around has a lot more potential for success for the company.

Right now, Yeti has a cult-like following for its products. Currently, its core markets are in the South and East Coast of the U.S., and that’s okay! This gives the company an opportunity to expand across the West Coast and even overseas.

In the first half of 2018, Yeti reported 34% revenue growth compared to the previous year. Its gross margins are approaching 50%, which is one of the most attractive features about the company’s financials.

The company was able to make $196 million in sales over the three months ending September 29th. The company is growing and making money — exactly what you want from a company that’s about to hit the market.

Yeti is offering 20 million shares on its IPO. It’s expected to price its IPO at $19 to $21. That would give the company a market cap range of $1.59 billion to $1.76 billion. Its underwriters for the IPO are Bank of America Merrill Lynch, Morgan Stanley, and Jefferies.

It will be trading on the New York Stock Exchange (NYSE) under the ticker symbol “YETI.” Keep an eye on this Thursday, October 25th, for Yeti’s market debut. I know I will!

Until next time,

Monica Savaglia

Monica Savaglia

Monica Savaglia is Wealth Daily’s IPO specialist. With passion and knowledge, she wants to open up the world of IPOs and their long-term potential to everyday investors. She does this through her newsletter IPO Authority, a one-stop resource for everything IPO. She also contributes regularly to the Wealth Daily e-letter. To learn more about Monica, click here.

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