YETI vs. Johnson Outdoors: Which Leisure Stock is a Better Buy?

NASDAQ: JOUT | Johnson Outdoors Inc. -  News, Ratings, and Charts

JOUT – Outdoor and recreation stocks outperformed in 2020 due to demand increasing during the pandemic. This is likely leading to a permanent increase in growth for stocks like Yeti (YETI) and Johnson Outdoor (JOUT).

Outdoor and recreation stocks had a banner year in 2020. The trend will likely continue as consumers developed new hobbies during the pandemic that have the potential to last a lifetime.

 

Even if you have not picked up an outdoor hobby in the past year, chances are you know someone who has. Those who started biking, camping, hunting, fishing, hiking, or another outdoor activity during the pandemic are likely to continue spending money on that hobby in the months and years ahead. Outdoor and recreation stocks stand to benefit.
 
In particular, two outdoor and recreation stocks are especially attractive: Yeti (YETI) and Johnson Outdoors (JOUT). Let’s take a closer look at each of these stocks to determine which is more deserving of a spot in your portfolio.
 
Yeti (YETI)

YETI makes and sells outdoor products. Hunters, fishermen, campers, hikers, farmers, and ranchers all rely on YETI products. Based in the 10th most populous city in the country, Austin, TX, YETI shares have nearly tripled in value in one year.

YETI has a C POWR Rating grade. The stock has an A Quality component grade along with Bs in the Sentiment and Momentum components. If you are curious as to how YETI fares in the rest of the POWR Rating components such as Value, Stability, and Growth, you can find out by clicking here.

Of the 70+ stocks in the Consumer Goods space, YETI is ranked 20th. As a whole, the Consumer Goods category has a C POWR Rating. You can learn more about the stocks in this category by clicking here.

YETI is priced about $4 away from its 52-week high of $91.55. However, the stock’s forward P/E ratio is not egregiously high, coming in at 37.08. YETI has a beta of 2.63 so it has the potential to prove volatile.

YETI has a one-year price return of 172%, a six-month price return of 36%, and a three-month price return of 26.55%. YETI is fresh off a fantastic earnings year in 2020. The company paid down more than $210 million of debt last year alone. YETI started the year with $250 million of cash and around $130 million of debt. If everything goes as planned, YETI’s revenue will spike to 17% for the year.

Company executives have predicted the majority of the growth will be in the first couple quarters of the year through an especially sunny and dry summer that could help YETI sales move even higher beyond the summer months. YETI’s foray into the luggage market will also help drive growth considering that most people are interested in traveling after a year of social isolation.

Johnson Outdoors (JOUT)

JOUT is one of the world’s largest outdoor recreation businesses. JOUT makes and markets products in the outdoor equipment, marine electronics, watercraft, and diving categories. From kayaks to canoes, tents, paddles, fishfinders, scuba diving equipment, and digital instruments, JOUT makes a little bit of everything adventure-related.

JOUT has an A POWR Rating grade, meaning it is a Strong Buy. JOUT has an A sentiment grade and Bs in the Quality, Momentum, and Value components. Investors who would like to learn how JOUT fares in the Stability and Growth components of the POWR Ratings can do so by clicking here.

Of the 34 stocks in the Athletics & Recreation industry, JOUT is ranked fourth. You can find out more about this sector by clicking here. JOUT has a five-year price return of 404%, a three-year price return of 64%, and a one-year price return of 58%.

Which is the Better Play?

JOUT is the better play. JOUT has a better POWR Rating grade. JOUT is ranked in the top five of its segment while YETI barely cracks the top 20. At the current moment, JOUT is the better of these two outdoor and recreation stocks.


JOUT shares were trading at $125.80 per share on Wednesday morning, up to $1.30 (+1.04%). Year-to-date, JOUT has gained 12.04%, versus a 12.64% rise in the benchmark S&P 500 index during the same period.


About the Author: Patrick Ryan


Patrick Ryan has more than a dozen years of investing experience with a focus on information technology, consumer and entertainment sectors. In addition to working for StockNews, Patrick has also written for Wealth Authority and Fallon Wealth Management. More...


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