Fitbit (NYSE:FIT) will probably beat analysts’ consensus expectations when the company unveils its third-quarter results on Oct. 31 after the market closes. And the company is likely to report progress on multiple fronts. However, Fitbit stock probably won’t get a huge bounce in the wake of the results, amid continued concerns about the impact of the trade conflict between the U.S. and China.

While those concerns will probably keep a lid on Fitbit stock in the near term, FIT stock is likely to rally strongly over the longer term.

Fitbit’s Conservative Guidance

In the second quarter, Fitbit’s new smartwatch, the Versa, appeared to have been more popular than the company had predicted. On its Q2 conference call in August, FIT noted that the Versa had “outsold all Samsung, Garmin and Fossil smartwatches in North America combined” during the quarter. The company reported that demand for the product had outpaced supply, strongly  suggesting that Fitbit had not baked such huge sales of the device into its guidance.

But despite the apparent positive surprise, Fitbit did not raise its 2018 revenue guidance of “roughly $1.5 billion.” Although Fitbit CEO James Park showed more optimism by tweeting that, “we expect … to return to growth and profitability in the second half of the year,” analysts’ estimates were probably based only on the official  guidance.

Consequently, there is a great chance that Fitbit’s Q3 results will beat analysts’ expectations.

Other Possible Positive Trends

Earlier this month, Fitbit released a new tracker, the Charge 3.

The device has multiple, significant improvements over its predecessor, and it got solid, if not glowing reviews. The Verge, for example,  lauded its “great design,” “more than a week of battery life,” and “reliable automatic workout tracking.”  Also on the tracker front, Fitbit stated during its Q2 conference call that, “we also believe the channel reduction of trackers has run its course” and said it was confident that sales of its trackers had bottomed in Q2.

Furthermore, the company noted that it had introduced “a number of key health apps” in Q2, including a blood glucose reader, while more than 2.9 million people had signed up for its female health tracking feature. Those new health apps and the popularity of the female health tracker may have spurred sales of many more devices last quarter.

Additionally, the company indicated that it would take steps to sell new diagnostics and coaching services to owners of Fitbit devices. While progress on that front probably won’t yet be material to the company’s results, it could make owners of Fitbit stock and the Street more upbeat about the company’s outlook.

Finally in Q2, Fitbit’s revenue from its Asia Pacific region jumped 66% year-over-year to $35 million. If the company’s products continued gaining traction in Asia, the region could meaningfully boost the company’s results.

Tariffs Still Likely to Worry the Market and Keep a Lid on Fitbit Stock

Although Fitbit’s products have — as of last month — been spared from U.S. tariffs.

But that situation may not continue, as Bloomberg reported yesterday that the U.S. may place tariffs on all U.S. goods if progress is not made on solving the trade conflict next month. As I mentioned earlier, investors’ concerns about that issue will probably prevent Fitbit stock from spiking very much even if it delivers beat-and-raise Q3 results on Wednesday.

The Favorable Valuation of Fitbit Stock and Fitbit’s Competitive Advantages

At current levels, the enterprise value per revenue of Fitbit stock is a tiny 0.4. If the company is indeed able to return to growth and profitability, that valuation is exceptionally attractive.

And importantly, Fitbit’s smartwatches have been able to maintain important advantages over Apple’s (NASDAQ:AAPL) smartwatches. Specifically, Fitbit’s watches remain meaningfully cheaper, have much longer battery lives, interface more effectively with Android devices, and measure more important aspects of people’s health than Apple watches.

Bottom Line on Fitbit Stock

Assuming that Fitbit is able to return to growth and profitability, as its CEO said it would and the valuation of Fitbit stock is very low. Moreover, FIT stock has multiple, upcoming  potential positive trends, and its smartwatches retain important competitive advantages over Apple Watches.

While worries about tariffs will likely keep FIT stock from advancing very much in the short term, over the next two years, Fitbit stock should at least triple from current levels.

As of this writing, the author owned shares of FIT stock.