Oct 29 2019

Fitbit stock price today

<a title="Fitbit stock price today" href="http://vds.remmont.com/fitbit-stock-price-today/">Fitbit stock price today</a>-<a title="Fitbit stock price today" href="http://vds.remmont.com/fitbit-stock-price-today/">Fitbit stock price today</a>
Fitbit stock price today-Fitbit (FIT) stock is maintaining its huge market presence in wearables, but Apple looks to be muscling in. Should investors avoid FIT, or buy?

Should You Buy Fitbit Stock? 3 Pros, 3 Cons (FIT)

Fitbit stock has sustained substantial losses but maintains a lead in the wearables market

Fitbit ( FIT ), the maker of a highly popular line of fitness trackers, got off to a roaring start with its IPO back in mid-June. The stock soared by 48% on its first day of trading after the company boosted the number of shares issued and the price range.

But since then, things have cooled down as the equities markets have gotten much more volatile. Fitbit stock is off about 35% from its high.

Despite this, the company continues to grow at a torrid pace. In the latest quarter, revenues spiked by 253% to $400 million and the adjusted EBITDA came to $86.2 million. For the period, FIT sold about 4.5 million devices, up from 1.72 million in the same period a year ago.

So, should you look at Fitbit stock as an opportunity, or could FIT’s cooling continue? To see, we’ll look at the pros and cons of Fitbit stock.

Fitbit Stock Pros

Dominant Player in the Wearables Market: Since launching in 2007, FIT has sold over 25.3 million devices — impressive, cons >FIT has partnerships with Tory Burch and Kellogg (K ), and also sells its devices in more than 45,000 retail stores, such as Best Buy ( BBY ).

Enormous Market Opportunity: According to International Data Corporation, the wearables market is the fastest among the global consumer electronics market. In 2014, shipments came to 19.6 million and they are forecast to hit 126.1 million by 2019, for about $27.9 billion in revenues. Some of the drivers include changes in lifestyles and the w >TRU ) and Quicken Loans.

Powerful Ecosystem: FIT has an open system based on application program interfaces that allow third parties to develop apps for the platform. The result is a rich diversity of functions for the devices. Cons >AAPL ), Andro >GOOG , GOOGL ) and Windows phones from Microsoft ( MSFT ).

Fitbit Stock Cons

Valuation: Even with the drop in Fitbit stock, the valuation is far from cheap. FIT shares trade at 35 times next year’s earnings estimates. Compare that to GoPro ( GPRO ), which has a multiple of 20, and Apple, which trades at a mere 11 times estimates. True, Apple may be a fairly mature — but then again, the company is still growing at a hefty rate. But at its lofty valuation, Fitbit stock could be vulnerable to even a small deceleration in growth.

Usage: Is a fitness device really a niche product? It could be. And some evidence of this actually comes from Fitbit’s S-1. After all, among 20.8 million devices sold, there were only 9.5 million active users. That sounds like significant churn, but don’t be surprised — health-oriented products often generate a lot of initial enthusiasm, but that can be difficult to maintain.

Competition: FIT must fight against tough competitors like Garmin ( GRMN ) and Samsung ( SSNLF ), but the biggest threat is likely to be Apple. With its amazing brand, cutting-edge technology and substantial marketing savvy, there is likely to be pressure from the recently launched Apple Watch. So far, it is tough to gauge the traction. Yet a recent survey from IDC indicates that Apple is now the No. 2 operator in the wearables space, with about 3.6 million units shipped in the second quarter. Granted, the Apple Watch seems to be fairly basic in terms of its functionality, but this is likely to change over time as AAPL continues to invest in the product.

Bottom Line

When it comes to the wearables market, FIT has a tremendous brand. It is the defining company in the space. And even though AAPL will likely take share away, the fact is that its devices will be more broad-based.

As for the health category, FIT is likely to remain a top player. This focus also should allow the company to take advantage of major trends, such as the growing corporate wellness market.

In the near term, there should be a nice catalyst from the upcoming Christmas season. And sooner than later, expect FIT to come out with new offerings, which could gin up excitement and sales.

So, should you buy Fitbit stock? Yes — even though the valuation is still pricey, the company is likely to remain in a high-growth phase.


Fitbit stock price today

SOURCE: http://investorplace.com/ipo-playbook/buy-fitbit-stock-3-pros-3-cons-fit/

Written by CREDIT

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