Dj Malibu Boats Price Target Raised To $38.00/Share From $34.00 By Truist Securities

(16:13 GMT) Malibu Boats Price Target Raised to $38.00/Share From $34.00 by Truist Securities

Malibu Boats, Inc. MBUU reported second-quarter fiscal 2025 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and bottom lines declined on a year-over-year basis.

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During the quarter, the company navigated a challenging marine market by leveraging its strong brand portfolio and industry-leading innovation while maintaining a strategic focus on dealer health. While the Year-End Sales event and early-season boat shows delivered moderate results, demand recovery heading into the selling season has been less robust than anticipated. Malibu Boats plans to monitor in-season shows to assess consumer interest. It remains cautious about near-term market conditions.

MBUU’s Q2 Earnings & Revenues

During the fiscal second quarter, the company reported adjusted earnings per share (EPS) of 31 cents, beating the Zacks Consensus Estimate of 21 cents. In the prior-year quarter, MBUU reported an EPS of 57 cents.

Quarterly revenues of $200.3 million beat the Zacks Consensus Estimate of $191 million by 5.1%. However, the top line declined 5.1% on a year-over-year basis. The downside can be attributed to lower unit volumes in the Malibu and Saltwater Fishing segments due to reduced wholesale shipments. However, this was partially offset by a favorable model mix in these segments and inflation-driven year-over-year price increases.

Malibu Boats, Inc. Price, Consensus and EPS Surprise

Malibu Boats, Inc. price-consensus-eps-surprise-chart | Malibu Boats, Inc. Quote

Malibu Boats Segmental Performance

During the fiscal second quarter, net sales in the Malibu segment decreased 3% year over year to $74.1 million. The downside was mainly driven by lower unit volumes, partially offset by a favorable model mix and inflation-driven price increases.

Net sales in the Saltwater Fishing segment declined 15.2% year over year to $70.2 million. Decreased units owing to lower wholesale shipments and retail activity primarily caused the downside.

During the quarter, revenues from the Cobalt segment increased 7.8% year over year to $56 million. The upside was driven by an increase in units and inflation-driven year-over-year price increases.

MBUU Operating Highlights

During the fiscal second quarter, selling and marketing expenses inched up 6.7% year over year to $6 million. The increase was mainly due to a rise in marketing events. As a percentage of sales, selling and marketing expenses increased 30 basis points to 3.0%.

General and administrative expenses during the quarter came in at $26.5 million compared with $15.4 million reported in the prior-year quarter. The increase was driven by legal fees, incentive pay, salaries and stock-based compensation expenses.

Operating income during the quarter came in at $3.2 million compared with $14.7 million reported in the prior-year quarter.

Adjusted EBITDA during the quarter came in at $16.9 million compared with $22.9 million reported in the prior year quarter. Adjusted EBITDA margin in the fiscal second quarter came in at 8.4% compared with 10.9% reported in the year-ago period.

MBUU’s Balance Sheet

Cash as of Dec. 31, 2024, totaled $35.1 million compared with $26.9 million on June 30, 2024.

Inventory during the quarter came in at $144.9 million compared with $145.6 million as of June 30, 2024.

As of Dec. 31, 2024, the company reported long-term debt of $23 million.

MBUU’s Fiscal 2025 Outlook

For fiscal 2025, the company expects the net sales percentage to be flat to down low single digits on a year-over-year basis. The company expects fiscal 2025 Adjusted EBITDA margin to be approximately 10%.

MBUU’s Zacks Rank

Malibu Boats currently carries a Zacks Rank #2 (Buy).

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