Please ensure Javascript is enabled for purposes of website accessibility

Why Fitbit, Inc. Shares Got Crushed Today

By Evan Niu, CFA - Jan 5, 2016 at 3:15PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The wearables maker's new smartwatch fails to impress.

What: Shares of fitness tracker maker Fitbit (FIT) got crushed today, down by 12% as of 3:00 p.m. ET, after the company unveiled a new smartwatch at the Consumer Electronics Show in Las Vegas as competition continues to heat up.

So what: The company took the wraps off of its new Blaze smartwatch, which features a color touchscreen alongside other expected functions like notifications and the requisite set of sensors to track fitness data. Blaze offers up to five days of battery life, and has interchangeable bands for user customization.

Image source: Fitbit.

The new device will cost $200, and Fitbit has started taking pre-orders. Meanwhile, Under Armour (UAA 1.83%) is jumping into the activity tracker market with a new suite of fitness products including a wearable band priced at $180.

Now what: As Fitbit continues its push upmarket to compete directly with other smartwatches, it's seeing competition intensify in the lower-end market for stand-alone fitness trackers. Full-featured smartwatches are already beginning to cannibalize stand-alone trackers, and Fitbit is responding to changing market conditions. Investors were also disappointed that Fitbit didn't introduce any meaningful updates to its current flagship Charge and Charge HR devices, which were released over a year ago.

Evan Niu, CFA has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Under Armour. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Fitbit, Inc. Stock Quote
Fitbit, Inc.
Under Armour, Inc. Stock Quote
Under Armour, Inc.
$10.03 (1.83%) $0.18

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/15/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.