What happened
Shares of Traeger Grills (COOK +5.44%) were hit hard on Thursday after the company released financial results for 2021 and issued financial guidance for 2022. Suffice it to say that investors had hoped for more from management's guidance, causing the stock to drop 14% as of 11 a.m. ET, although it had been down as much as 23% earlier in the session.
NYSE: COOK
Key Data Points
So what
For 2021, Traeger grew its revenue 44% from 2020 to $786 million. In the fourth quarter alone, the company generated revenue of $175 million, exceeding analysts' expectations. This did come at a net loss of almost $89 million for the year. But keep in mind that $81 million of this net loss was due to stock-based compensation -- a common noncash expense for companies that have recently gone public.
Image source: Getty Images.
For 2022, Traeger management expects to generate revenue of $800 million to $850 million and earn adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $70 million to $80 million. For perspective, these projections represent year-over-year growth rates of 2% to 8% on the top line and 5% to 20% on the bottom line.
Unfortunately for Traeger shareholders, the analyst community expected better growth, and multiple analysts reduced their price targets for Traeger as a result, according to The Fly.
Now what
Traeger will host a livestream event to highlight new products on March 30 at 12:30 p.m. ET. The company does have strong brand loyalty from its customers -- according to third-party data source Comparably, Traeger has 72% brand loyalty. It's possible, therefore, that Traeger can introduce some new products that will really resonate with its fan base. However, I don't believe investors should get too excited about the upcoming event, considering management already knew about this when it issued guidance for 2022.
