SunTrust Thinks Fitbit Q2 Sales Could Pick Up

Fitbit Inc FIT has announced that it has shipped more than one million each of its Alta and Blaze devices over the past month since they were launched.

Robert S. Peck of SunTrust Robinson Humphrey maintained a Buy rating on the company.

Alta & Blaze

According to the SunTrust report, “Alta replaces the Charge at the same price point and is much more fashion oriented, hence it isn't surprising that it has become one the of top selling devices within the fitness tracker and pedometer category at Amazon.com.”

On the other hand, Blaze shipments beat the company’s sales guidance. Peck mentioned that the device has initially received mixed reviews.

However, at a new price point that placed it between the Charge HR and Surge, Blaze currently ranked first, both on the smartwatch as well as the heart monitor categories on Amazon.com.

Sales Uptick in 2Q

Given that “2Q is seasonally stronger than 1Q and includes Mother’s Day and Father’s Day,” Peck expects Fitbit’s sales to pick up.

In addition, with high ratings and positive reviews, as well as the tendency to upgrade, the analyst expects meaningful reorder volumes during 2Q.

“Given newer devices typically account for ~80% of unit sales and FIT shipped 2+M of these units in March alone, we believe our 5M/6M estimates for unit sales in 1Q/2Q'16 are reasonable,” Peck added.

Also, the analyst expects additional new product launches through the remainder of the year, which in turn supports expectations of robust top line growth in 2016.