“We are warming up,” wrote Wedbush analysts in a Wednesday note, though they didn’t change their “neutral” rating or $6 price target—right around current levels—on the Barron’s Next 50 company’s shares. (That’s generally in line with Wall Street’s outlook, according to FactSet data.)
While Fitbit (FIT) yesterday said CFO Bill Zerella is leaving, there are certainly reasons for optimism as it works to become a smartwatch company rather than a fitness tracker outfit.
Fitbit had a ready replacement, COO Ronald Kisling, a four-year company veteran. More generally, its well-reviewed Versa smartwatch has already sold more than 1 million units, and users appear to be taking to its new health apps. That news has helped pull the company’s shares into positive territory, and ahead of the S&P 500, for the year.
Wedbush indicated some concern that the Versa might be eating into sales of its more expensive predecessor, the Ionic; that could contribute to an expected to be a dip in full-year sales. Longer-term, though, the analysts believe Fitbit has a shot to compete with the Apple (AAPL) Watch and other devices.
. “Fitbit is slowly turning the ship around, with success in lower pricepoint smartwatches and eventual growth from subscription revenue in medical applications,” they wrote, suggesting that they won’t represent a “material” contribution to revenue until next year.
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