Could A Buy Rating From BofA Make Clarus Stock Reach A Peak?

Clarus Corp CLAR has a unique portfolio of “Super Fan” leisure brands and is poised to benefit from the trend of “solitary leisure,” according to BofA Securities.

The Clarus Analyst: Alexander Perry initiated coverage of Clarus with a Buy rating and a price target of $35.

The Clarus Thesis: The company’s “Super Fan” leisure brands Black Diamond and Rhino-Rack have “strong brand recognition but low penetration,” Perry said in the initiation note.

“According to ListenFirst Instagram data, Black Diamond fans engage more with the brand compared to large outdoor competitors such as Patagonia, The North Face, and Columbia Sportswear,” he added.

“We believe Clarus is a COVID-19 beneficiary as spending at key end markets for Clarus remains elevated vs. 2019 with spending at specialty ski shops (which has a 74% correlation with Black Diamond revenue Growth) is up 25% YTD vs. 2019, spending at sporting goods stores (one of Clarus’ key wholesale channels) is up 44% YTD vs. 2019, and spending at campgrounds up 37%,” the analyst wrote.

Bank of America’s aggregated credit and debit card data indicate “an acceleration in QTD spending growth at ski shops,” he further mentioned.

CLAR Price Action: Shares of Clarus are up 2.43% to $25.15 Tuesday morning at publication.

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