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Fitbit (FIT) earnings preview: is the company turning around?

Carla Olson | 2:19 pm ET, 31 Jul 2018

Fitbit, Inc. (FIT) is expected to report earnings on August 1 after market close. The report will be for the fiscal quarter ending June 2018. Shares are trading at 6.00, down -0.33%.

What are FIT earnings expectations?  What news should investors be paying attention to?

Fitbit investors have seen a plenty of stock volatility in the recent months.  The shares have soared and dropped frequently, as different ideas about the future of the company are presented. Fitbit was the first company to offer a wearable fitness tracker that appealed to a broad market.

The Fitbit Versa smartwatch is the product investors think will turn the company around.  The product retails for $200 and includes a plenty of useful features: workout tracking, heart rate, female health, sleep tracking, limited apps, and notifications.  It also boasts a long battery lifetime: 4 days.  

Fitbit (NYSE:FIT) wearables and Apple (NASDAQ:AAPL) watches could be soon hit with the latest round of U.S. tariffs on $200B of Chinese goods.   These products fall under the subheading of data transmission machines in U.S. tariff codes and appear to be included in the list of President Trump’s most recent tariff proposal.  

Fitbit Inc. has a mixed history of beating analysts’ earnings estimates.  In the past four quarters, the company: 

  • Beat analyst EPS estimates by 7 cents ($-.08 actuals vs. $-.15 forecast) in FQ2’17;
  • Beat analyst EPS estimates by 2 cents ($-.01 actuals vs. $-.03 forecast) in FQ3’17;
  • Missed analyst EPS estimates by 2 cents ($-.02 actuals vs. $0 forecast) in FQ4’17;
  • Beat analyst EPS estimates by 3 cents ($-.17 actuals vs. $-.20 forecast) in FQ1’18.

For FQ2’18, EPS is expected to decline by 200% year-over-year to $-.24, while revenue is expected to decline 19% year-over-year to $286 million.  

Over the last month, Fitbit, Inc. (FIT) returned -14.41%. 

Fitbit, Inc. (FIT) short share of float is 13.4%. The stock is much more frequently shorted than the average industry, sector or S&P 500 stock.

Fitbit, Inc. (FIT) average analyst price target ($6.06) is 1% above its current price ($6.00).

For the latest price and information on Fitbit, Inc., please visit Finstead and search for "FIT price" or "FIT news".

Disclaimer: The news article above expresses the author’s opinion about the topic of the article. We strongly advise you not to base your investment decisions just on this article alone. If you’d like to become a writer for Finstead Bites, please send us an email at hi@finstead.com.


Fitbit (FIT): Is The Stock Worth Investing In?

Carla Olson | 4:53 pm ET, 16 Apr 2018

The Fitbit stock (NYSE: FIT) barely moved today.  What is the stock price forecast for this company?

And what are the things you should know about this stock?

Fitbit offers a range of health devices and is gradually gaining steam since the holiday season of this year.

But in the previous year, the company had a turbulent period. Sales declined by 25% because the company's products didn’t cater to consumer demands, and the competition was very aggressive.  The Fitbit smartwatch proved to be a dud.   

It is necessary for the company to focus on hardware and software aspects of its smartwatches, to stand up against the stiff competition from its rivals, such as Garmin and Apple.  

A huge discount offered to investors today is a clear indication of the challenges the company faces. 

Should you invest in Fitbit’s stock? Per Finstead Research, the company’s shares have the average price target of almost $7.  The stock has an upside of about 21% (vs. current price).

The Fitbit stock has a negative valuation, which indicates that the company registered losses in the past. Trading negative-P/E shares is highly speculative.

Fitbit has a high short share of float, compared to the industry and sector averages. This indicates high potential volatility in the upcoming days.

Disclaimer: The news article above expresses the author’s opinion about the topic of the article. We strongly advise you not to base your investment decisions just on this article alone. If you’d like to become a writer for Finstead Bites, please send us an email at hi@finstead.com.


Fitbit, Inc. (FIT) Buy or Sell Stock Guide

Updated at: 10:44 am ET, 12 Jul 2019

Are you looking for the analysis of Fitbit, Inc. (FIT) stock? Are you wondering what the bulls and the bears say about it?

If so, you came to the right place. In this stock guide, we will share with you 13 reasons to buy and 5 reasons to sell FIT stock. You’ll get a perspective on what the bulls and the bears say about it.

The analysis below may be also helpful to you if you have any of the following questions about FIT stock:

  • Is FIT a buy or a sell?
  • Should I sell or hold FIT stock today?
  • Is FIT a good buy / investment?
  • What are FIT analyst opinions, recommendations and ratings?

Let’s start with the bull case. Here are the reasons to buy FIT stock:

1. Fitbit is a global brand with a first-mover advantage and remains one of the leading providers of wearable fitness trackers. Being one of the first to market these devices, the company has been able to build a knowledge base about users’ fitness habits and demand for health monitoring devices. This, along with a concerted brand building effort, innovative new products and improved distribution has led to an increasingly loyal customer base.

2. Fitbit is also riding a couple of secular growth trends. This includes a trend toward better health and fitness behavior noticed among consumers. Another is an economic trend where consumers are increasingly eager to assume responsibility for their healthcare and are willing to pay directly for products that help them monitor their health.

3. Fitbit is seeing strong international growth. From the outset, it has taken a local approach to global expansion with the goal of becoming a household name in all the countries it serves. The company has entered India through Amazon and Reliance distribution systems, and is now trying to partner with local distributors to target mom-and-pop outfits.

4. However, retail is not Fitbit’s only growth engine. The company has made a lot of progress on the corporate wellness front as well, selling fitness trackers and software subscriptions to employers as part of their corporate wellness programs. It has also done a good job convincing companies, benefit brokers and employees about the importance of self-monitoring devices in bringing down healthcare costs.

5. Software product and social network development can drive future growth for Fitbit. Usual member social activity comprises linking to friends on the network, messaging friends, sharing data concerning health targets and metrics with other members, with fitness groups, with trainers, and with corporate wellness programs. The company also has a friend discovery feature in the challenges experience making it even easier to connect with friends on Fitbit and start step challenges.

6. The market for wearable fitness devices is growing. International Data Corp. expects the market for wearable devices to increase to 240.1 million units by 2021, at a compound annual growth rate (CAGR) of 18.2%. Of these, the largest segment, the watch category is expected to contribute 67% to total wearables shipment by 2021, increasing from its current level of 56.9%.

7. Fitbit is currently working on a turnaround strategy. The company underwent an executive shakeup in March aimed mainly at turning around its ailing fortunes. Chief business officer, Woody Scal and executive vice president, Interactive, Tim Roberts stepped down.

8. FIT stock price ($4.43) is close to the 52-week low ($4.27). Perhaps now is a good time to buy? See FIT price chart.

9. FIT quarterly revenue growth was 8.82%, higher than the industry and sector average revenue growth (6.21% and 5.11%, respectively). See FIT revenue growth chart.

10. FIT Price/Book ratio is 1.66, and it’s low compared to its industry peers’ P/B ratios. See FIT forward Price/Book ratio chart.

11. FIT Price/Sales ratio is 0.71, and it’s low compared to its industry peers’ P/S ratios. See FIT forward Price/Sales ratio chart.

12. FIT average analyst rating is Buy. See FIT analyst rating chart.

13. FIT average analyst price target ($6.75) is above its current price ($4.43). See FIT price target chart.

Now that you understand the bull case, let’s look at the reasons to sell FIT stock (i.e., the bear case):

1. After years of maintaining its leading position in the wearables market, Fitbit finally lost its ground to Xiaomi. According to the latest International Data Corporation (IDC) report, Xiaomi is tied at the top in terms of third-quarter 2017 shipment volumes, with it having shipped 3.6 million units. Fitbit has been pushed to the second position.

2. Fitbit’s growth has been slowing down with smartwatches outshining the fitness wearable category, influx of new wearables, lack of upgrades among existing users and lackluster growth in the Asia Pacific region. Despite the broad range of devices Fitbit provides at different price points, it has been facing tough competition at both the high- and low-end products. At the high end, there is Apple’s multi-functional Apple Watch, which renders Fitbit devices useless.

3. FIT profitability is declining. The YoY profit margin change was -12.42percentage points. See FIT profitability chart.

4. FIT short share of float is 12.78%. The stock is much more frequently shorted than the average industry, sector or S&P 500 stock. See FIT short share of float chart.

5. FIT short interest (days to cover the shorts) ratio is 5.94. The stock garners more short interest than the average industry, sector or S&P 500 stock. See FIT short interest ratio chart.

Now let's look at the key statistics for FIT:

Metrics FIT
Price $4.38
Average Price Target / Upside $6.75 / 53.93%
Average Analyst Rating Hold
Industry Scientific & Technical Instruments
Sector Technology
Number of Employees 1,694
Market Cap $1.14B
Forward P/E Ratio N/A
Price/Book Ratio 0.7186
PEG N/A
Revenue (TTM) $1.54B
YoY Quarterly Revenue Growth 8.823529411764707%
Profit Margin -11975.324675324677%

What are your thoughts on FIT?

If you liked this analysis, check out Buy or Sell Stock Guides for other stocks.

Disclaimer: The news article above expresses the author’s opinion about the topic of the article. We strongly advise you not to base your investment decisions just on this article alone. If you’d like to become a writer for Finstead Bites, please send us an email at hi@finstead.com.


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