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Fitbit (FIT) Expands Share in Wearable Space With Charge 4

Zacks Equity Research

Fitbit FIT is firing on all cylinders to bolster presence in the wearable and fitness world on the back of robust technologies and innovative products.

Recently, the company unveiled its latest and advanced fitness tracker called Charge 4. The new device comes with GPS and allows users to subscribe to music streaming apps like Spotify.

With the latest move, Fitbit expands its family of Charge devices. Consequently, the product portfolio has expanded, which bodes well for its market share.

New GPS Feature to Drive Demand

The physical appearance of the new device remains almost same as Fitbit Charge 3, with an inductive button, 1.36-inch display and swappable band system. Priced at $150, the device is swim proof, with a battery life of seven days.

The new addition in this device is the built-in GPS for location tracking. The inclusion of GPS will allow a user to perform workouts or jogging sessions without a phone.

Moreover, the new Fitbit Pay feature will allow users to make payments without phone, making it easy and convenient.

We believe the company will be able to strengthen the adoption rate of its products, thanks to strong efforts toward technical innovation. Consequently, this will expand the customer base and drive top-line growth.

Fitbit, Inc. Price and Consensus


Fitbit, Inc. Price and Consensus

Fitbit, Inc. price-consensus-chart | Fitbit, Inc. Quote

Bottom Line

Fitbit is a global brand with a first-mover advantage and is one of the leading providers of wearable fitness trackers. Being one of the first to market these devices, the company has been able to build a knowledge base about users’ fitness habits and demand for health monitoring devices.

However, recently, Fitbit has been grappling with mounting competition from companies such as Apple AAPL, Garmin GRMN, Samsung Electronics Co, as well as China's Huawei Technologies Co Ltd and Xiaomi Corp.

Notably, last year, Fitbit had entered into a definitive agreement to be acquired by Google. The deal will likely help the company to accelerate innovation in the wearables category. This acquisition will enable Fitbit to invest heavily in research and product development, and compete better in the wearables market.

Notably, the Charge 4 is Fitbit’s first tracker after the company was acquired by Google. Fitbits’s continuous efforts toward enhancing product offerings should help it to at least gain some momentum in the growing wearable and fitness market.

Zacks Rank & Stock to Consider

Currently, Fitbit carries a Zacks Rank #4 (Sell). A better-ranked stock in the broader technology sector is Stamps.com Inc. STMP, sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth for Stamps.com is currently projected at 15%.

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