B. Riley’s analysis of the marine industry produced a largely positive outlook for all four companies it covers — Brunswick Corp., MarineMax, Marine Products Corp. and West Marine — despite the fact that early spring sales have lagged somewhat because of cold weather in much of the United States.
Earnings and Analysts
Quarterly earnings statements from public companies and periodic reports from analysts reveal the health and direction of the industry.
Chilly weather might have inhibited late winter and early spring boat sales, but innovative product seems to be boosting boat show sales and leads across all price points, potentially enough to offset any early losses.
Malibu Boats’ accelerated product development cycle and innovations in a high-growth segment keep the brand poised for continued market share gains, according to a report by Wells Fargo analysts.
Malibu Boats reported a net sales increase of more than 16 percent to $43.9 million for the second quarter of 2014.
Wells Fargo analysts are giving Malibu Boats stock an initial rating of “outperform,” estimating that shares offer up to a 20 percent total return, based on the bank’s 2015 estimates.
A 16.3 percent increase in December sales in the industry’s main powerboat segments has led a Wells Fargo analyst to remain upbeat on Brunswick Corp. stock.
Marine Products Corp., the builder of Chaparral and Robalo boats, today reported a 16 percent fourth-quarter sales gain and said it more than doubled its profit for the period.
Twin Disc said sales dropped 12 percent in its second quarter because the company had less business in North America and Europe and its sales to customers serving the global megayacht market stayed at historical lows.
Brunswick Corp. will release its fourth quarter and full-year 2013 financial results on Jan. 30 before the market opens.
A Bridgewater Investments analyst says the boat business “remains a poor business to be in,” cautioning investors against betting on companies that aren’t diversified in their offerings or focused on global sales.