10 Footwear Apparel Stocks Affected By China Tariffs

1. YETI Holdings Inc. (NYSE:YETI)

YETI Holdings Inc. is a leading consumer and outdoor products company that retails, develops, and distributes cargo, coolers & equipment, bags, outdoor living, backpacks, and other products. The company supplies its products through its website and independent retailers. The company sources 40% of its products from China.

The stock has underperformed the S&P 500 in the last year. However, a changing business plan could make 2025 a completely different year for the company despite tariffs. Investors would be glad to know that the company’s 40% exposure to China isn’t that big a deal. In the third quarter, YETI commenced operations on its second manufacturing facility for the Drinkware portfolio line. The third facility is also in the pipeline. The interesting part is that both these facilities are outside China!

If there is one thing investors should know about this company, it’s the management’s proactive strategy to deal with tariffs. This is what CEO Matt Reintjes had to say about the company’s supply chain expansion plans:

As a reminder, approximately 40% of our total cost of goods has historically been tied to products sourced from China, primarily related to our drinkware portfolio… Notably, we commenced production at our second drinkware facility outside of China during the quarter and we are on pace for a third facility.

Along with this initiative, the company is experiencing improving demand in the international market. YETI’s international operations are relatively small, forming just 18% of the company’s total revenues. However, the 30% YoY growth in the third quarter suggests it is able to meet international demand and gain market share, which could drive significant growth for the company in the coming years.

In short, despite 40% exposure to China, the company is in a great position.

YETI Holdings is not on our latest list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 31 hedge fund portfolios held YETI at the end of the third quarter which was 31 in the previous quarter. While we acknowledge the potential of YETI as a leading AI investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as YETI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.