Traeger initiated with bullish view at B. Riley, here’s why

B. Riley analyst Anna Glaessgen initiated coverage of Traeger with a Buy rating and $3.50 price target. Traeger is a leading player in the pellet grill market, which has faced significant model uncertainty over the past few years stemming from the COVID unwind, excess channel inventories, and supply chain headwinds, in addition to an increasingly discerning consumer, the analyst tells investors in a research note. However, the firm believes these headwinds are fully appreciated in the shares and sees normalized channel inventories as aiding in the company’s sales visibility. It sees Traeger’s EBITDA supported by margin tailwinds, namely lower freight rates. It expects decent execution against relatively muted expectations to offer upside potential for the shares.