The growth outlook for Yeti Holdings looks murky in the months ahead, according to Goldman Sachs. Analyst Brooke Roach downgraded shares of the cooler company to neutral from buy, citing a tougher sales backdrop and softening consumer demand that should hinder growth near term. “While we continue to see several of these drivers as long-term opportunities, we now have less conviction in the outlook for revenue outperformance as growth in core product categories (drinkware) and channels (wholesale) have faded on both a 1-yr and 3-yr CAGR basis,” she said. YETI YTD mountain Yeti shares this year The stock fell 2% before the bell Friday. Shares of Yeti are down about 5% this year and have tumbled 57% since Goldman Sachs initiated coverage with a buy rating. Along with the downgrade, Roach trimmed the bank’s price target to $43 from $51 a share, implying 9% upside from Thursday’s close. “In short, we acknowledge our call was wrong, and now see a more balanced risk/reward,” she wrote. Yeti also faces rising competitive pressures in the drinkware market, and higher selling, general and administrative expenses should hamper margin improvement, Roach said. “Longer-term, we see healthy margin recapture opportunity following freight and supply chain cost disruptions, but believe the recapture of this margin will likely be slower to achieve given higher rates of reinvestment to fuel innovation, technology, and growth,” she said. — CNBC’s Michael Bloom contributed reporting
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