YETI Holdings Inc. (YETI) stock is surging 15.41% in pre-market trading on Monday, as investors react positively to a significant deescalation in trade tensions between the United States and China. The outdoor product manufacturer is among several strong brands expected to benefit from newly announced tariff reductions, which have sparked optimism in the market.
According to reports, the United States has agreed to lower the base level of tariffs on most Chinese goods to 30% from 145%, while China will cut its levies on U.S. products to 10% from 125%. This agreement is part of a 90-day period aimed at easing trade tensions between the two economic powerhouses. The move is expected to alleviate cost pressures on companies like YETI that have been grappling with tariff-related headwinds.
Jefferies analysts have specifically recommended buying shares of YETI Holdings, along with other strong brands such as Five Below, Nike, and SharkNinja. The analysts believe that despite varying tariff-related challenges from China, these companies can mitigate impacts due to their scale. As trade discussions progress during the 90-day pause, management teams could potentially face significantly lower costs, as most businesses have been planning based on the assumption of a 145% tariff. This positive outlook has contributed to the substantial pre-market rally in YETI's stock price.
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