RBC Capital Downgrades Traeger to Sector Perform, PT Drops to $1.25.

RBC Capital Downgrades Traeger to Sector Perform, PT Drops to $1.25.

RBC Capital Markets has downgraded Traeger Inc. to "Sector Perform" and reduced its price target to $1.25, following the company's second-quarter earnings report. The downgrade comes after Traeger missed both earnings and revenue forecasts for the quarter, with EPS falling short by 120% and revenue by 12.61% [1].

Traeger reported an EPS of -$0.01, significantly below the expected $0.05, and revenue of $145.5 million, down from the forecasted $166.49 million. The company attributed the shortfall to a challenging consumer sentiment environment and competitive pressures in the accessories market [1].

Despite the earnings miss, Traeger's stock price remained stable in aftermarket trading, closing at $1.70, a 3.03% increase from the previous close. The stock is currently trading below its Fair Value, with high price volatility being a characteristic feature [1].

For the fiscal year 2025, Traeger has provided revenue guidance of $540-$555 million, indicating an 8-11% decline. The company expects grill revenues to decline in the high single digits but anticipates a gross margin between 40.5% and 41.5%. Adjusted EBITDA is projected to be between $66 million and $73 million [1].

The downgrade by RBC Capital Markets reflects the company's ongoing challenges and the uncertainty surrounding its ability to execute on its long-term initiatives and product innovations. Investors should closely monitor Traeger's performance and the company's ability to navigate the competitive landscape and economic headwinds [1].

References:
[1] https://www.investing.com/news/transcripts/earnings-call-transcript-traeger-misses-q2-2025-earnings-forecasts-93CH-4175238