Fitbit's Stock Soars On Heavy Volume, Again
Fitbit Inc.'s stock surged 6.2% in active morning trade Thursday, adding to its third-biggest-ever one-day jump in the previous session, as investors continued to cheer about the fitness-tracker's opportunity in the corporate wellness movement. Volume of 6.5 million shares in the first hour of trade was already above the full-day average of 5.8 million shares, according to FactSet. On Wednesday, the stock soared 12% on volume of 10.1 million shares after Target Corp. said it would give every U.S. employee a free or discounted Fitbit as part of its employee wellness initiative. Target had 326,551 full-time and part-time U.S. employees in 49 states as of April. Analyst Brad Erickson at Pacific Crest said Target's move reinforces his thesis around the "compelling" corporate wellness opportunity, which he believes is still "underappreciated." He said the news also highlights Fitbit's dominant position in that market. "We believe corporate wellness is currently less than 10% of the business, but with 151 million people insured in the United States alone, and that market likely penetrated below 10%, we believe Fitbit is best positioned to capitalize on similar deals going forward," Erikson wrote in a note to clients.
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