Malibu Boats (MBUU) AI Stock Analysis

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Malibu Boats

(NASDAQ:MBUU)

51Neutral

Malibu Boats is experiencing significant financial difficulties, with negative profitability and declining cash flow metrics. The technical analysis indicates a weak performance with the stock trading below key moving averages. Although the earnings call suggests some resilience in tough market conditions, the overall outlook remains challenging due to operational inefficiencies and market pressures.

Positive Factors

Financial Performance

MBUU generated nearly $30M in cash flow this quarter.

Management Strategy

Management has aligned production levels with current demand and successfully reduced inventories to historical averages, creating a more attractive setup for future demand pivots.

Sales Event Success

Encouraged by its annual Ski/Wake (Malibu/Axis) sales event, with higher retail sell-through and participation, as well as reduced promotional activity, relative to last year.

Negative Factors

Market Guidance

MBUU cut guidance from flat-to-LSD growth to flat-LSD declines y/y and an AEBITDA margin of 10% (flat y/y), stating that it does not see a clear upward retail trend.

Retail Environment

A persistent soft retail environment is expected this fall, with dealer focus remaining on reducing inventories.

Sales Decline

MBUU reported a significant decrease in net sales driven primarily by decreased unit volumes across all segments, partially offset by a favorable model mix and inflation-driven price increases.

Malibu Boats (MBUU) vs. S&P 500 (SPY)

Market Cap

$523.08M

Dividend YieldN/A

Average Volume (3M)225.51K

Price to Earnings (P/E)―

Beta (1Y)0.67

Revenue Growth-39.56%

EPS Growth-238.09%

CountryUS

Employees2,250

SectorConsumer Cyclical

Sector Strength63

IndustryAuto - Recreational Vehicles

Share Statistics

EPS (TTM)-4.35

Shares Outstanding19,635,294

10 Day Avg. Volume334,081

30 Day Avg. Volume225,510

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.79

Price to Cash Flow (P/CF)5.10

P/FCF Ratio6.40

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$38.29

Price Target Upside46.65% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering7

Malibu Boats Business Overview & Revenue Model

Company DescriptionMalibu Boats, Inc. engages in the design, engineering, manufacturing, marketing, and sale of a range of recreational powerboats. It operates through three segments: Malibu, Saltwater Fishing, and Cobalt. The company offers performance sport boats, and sterndrive and outboard boats under the Malibu, Axis, Pursuit, Maverick, Cobia, Pathfinder, Hewes, and Cobalt brands. Its products are used for a range of recreational boating activities, including water sports, such as water skiing, wakeboarding, and wake surfing, as well as general recreational boating and fishing. The company sells its products through independent dealers in North America, Europe, Asia, the Middle East, South America, South Africa, and Australia/New Zealand. Malibu Boats, Inc. was founded in 1982 and is headquartered in Loudon, Tennessee.

How the Company Makes MoneyMalibu Boats generates revenue through the sale of its powerboats, which are offered under its various brand names. The company's primary revenue stream comes from the direct sale of boats to a network of independent dealers who then sell to the end consumers. In addition to boat sales, Malibu Boats also earns from the sale of related parts and accessories, which support its core product offerings. Another significant source of revenue is through its premium service offerings, which include warranty services and maintenance packages. Malibu Boats' strategic partnerships with dealers and suppliers play a crucial role in its business operations, ensuring a widespread distribution network and access to high-quality materials for manufacturing. The company is also influenced by factors such as consumer preferences for water sports activities, economic conditions affecting discretionary spending, and technological advancements in boat design and manufacturing.

Malibu Boats Financial Statement Overview

Summary

Malibu Boats is facing substantial financial challenges, with declining profitability and cash flow metrics that suggest operational inefficiencies. The balance sheet remains relatively stable with low leverage, but declining asset and equity figures present potential future risks. Immediate strategic actions may be required to improve financial health and operational efficiency.

Income Statement

Neutral

Malibu Boats has experienced a significant decline in both revenue and profitability in the TTM period. Gross Profit Margin and Net Profit Margin have turned negative due to operational challenges, as evidenced by negative EBIT and EBITDA margins. This reflects a concerning trend in operational efficiency and overall financial health compared to previous fiscal years.

Balance Sheet

Neutral

The company's balance sheet shows a moderate level of stability. The Debt-to-Equity ratio remains low, indicating manageable leverage. However, there has been a decline in Stockholders' Equity and Total Assets, which could pose future risks if not addressed. Return on Equity has turned negative, reflecting recent profitability challenges.

Cash Flow

Neutral

Despite negative net income, Malibu Boats maintains a positive operating cash flow, suggesting effective cash management in operations. However, Free Cash Flow has decreased significantly compared to previous years, and the Free Cash Flow to Net Income ratio is unfavorable, highlighting cash flow challenges.

TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Breakdown
Income Statement		Total Revenue
733.99M	829.03M	1.39B	1.21B	926.51M	653.16M
	Gross Profit
115.07M	147.09M	351.30M	310.05M	236.49M	149.27M
	EBIT
-4.59M	-55.95M	144.78M	213.82M	149.78M	85.31M
	EBITDA
-75.73M	-22.95M	278.29M	240.15M	183.59M	107.27M
	Net Income Common Stockholders
-88.74M	-55.91M	104.51M	157.63M	109.84M	61.56M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
4.53M	26.95M	78.94M	83.74M	41.48M	33.79M
	Total Assets
54.32M	739.62M	925.92M	851.33M	742.78M	477.35M
	Total Debt
63.41M	7.94M	2.32M	119.62M	143.28M	82.84M
	Net Debt
58.88M	-19.00M	-76.61M	35.87M	101.80M	49.05M
	Total Liabilities
85.08M	204.91M	310.17M	337.76M	361.63M	215.82M
	Stockholders Equity
-30.76M	530.01M	607.88M	503.17M	373.43M	254.58M
Cash Flow		Free Cash Flow
21.72M	-20.40M	129.89M	109.78M	100.64M	52.85M
	Operating Cash Flow
59.85M	55.56M	184.73M	164.85M	131.31M	94.14M
	Investing Cash Flow
-37.68M	-75.84M	-54.64M	-61.62M	-181.09M	-40.39M
	Financing Cash Flow
-42.56M	-31.70M	-134.57M	-60.38M	57.35M	-47.32M

Malibu Boats Technical Analysis

Technical Analysis Sentiment

Negative

Last Price26.11

Price Trends

50DMA

31.90

Negative

100DMA

35.55

Negative

200DMA

36.79

Negative

Market Momentum

MACD

-1.54

Positive

RSI

37.75

Neutral

STOCH

36.45

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MBUU, the sentiment is Negative. The current price of 26.11 is below the 20-day moving average (MA) of 28.66, below the 50-day MA of 31.90, and below the 200-day MA of 36.79, indicating a bearish trend. The MACD of -1.54 indicates Positive momentum. The RSI at 37.75 is Neutral, neither overbought nor oversold. The STOCH value of 36.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MBUU.

Malibu Boats Risk Analysis

Malibu Boats disclosed 46 risk factors in its most recent earnings report. Malibu Boats reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Malibu Boats Peers Comparison

Overall Rating

UnderperformOutperform

Sector (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MPX	67 Neutral	$282.49M	16.32	11.94%	6.93%	-38.35%	-59.21%
ONEW	64 Neutral	$222.59M	―	-2.97%	―	-7.72%	81.39%
BC	64 Neutral	$2.95B	23.16	7.50%	3.89%	-18.19%	-68.10%
Sector *	60 Neutral	$7.23B	11.55	3.67%	4.04%	2.96%	-13.54%
MCFT	60 Neutral	$254.14M	―	-1.53%	―	-45.70%	-115.77%
PII	53 Neutral	$1.90B	17.44	8.18%	8.04%	-19.69%	-77.72%
MBUU	51 Neutral	$523.08M	―	-15.71%	―	-39.56%	-238.09%

* Consumer Cyclical Sector Average

Performance Comparison

MBUU

Malibu Boats

26.11

-8.05

-23.57%

Brunswick

43.34

-36.89

-45.98%

MPX

Marine Products

8.08

-0.90

-10.02%

PII

Polaris

32.36

-50.74

-61.06%

MCFT

MasterCraft Boat Holdings

15.43

-5.45

-26.10%

ONEW

OneWater Marine

12.84

-10.61

-45.25%

Malibu Boats Earnings Call Summary

Earnings Call Date: Jan 30, 2025 | % Change Since: -32.11% | Next Earnings Date: May 8, 2025

Earnings Call Sentiment Neutral

The earnings call reflects a challenging quarter with several negative financial impacts, such as decreased net sales, unit volumes, and GAAP net income. Despite these challenges, the company managed to perform slightly better than expected, with strong cash generation and successful promotional events. The focus remains on maintaining dealer health and strategic inventory management.

Highlights

Slightly Better Than Expected Q2 Results

The second fiscal quarter results came in slightly higher than expected, despite the traditionally slower time of year.

Malibu Axis Year-End Sales Event Success

The event saw higher overall retail sell-through and good participation compared to last year with moderating levels of promotional support.

Consolidated Net Sales Per Unit Increase

Net sales per unit increased 6.6% to $163.9 per unit, driven by favorable model mix and inflation-driven price increases.

Strong Balance Sheet

Generated over $28 million in cash from operations in the quarter with capital expenditures of $5.6 million and $10 million in stock repurchases.

Lowlights

Net Sales and Unit Volume Decrease

Net sales decreased 5.1% year-over-year to $200.3 million and unit volume decreased by 11% to 1,222 units.

Challenging Retail Marine Market

The market is down low double digits year-to-date, influenced by sustained interest rate pressures and regional impacts from hurricane season.

Significant Decrease in GAAP Net Income

GAAP net income for the quarter decreased 76.1% versus the prior year to $2.4 million.

Adjusted EBITDA and Margins Drop

Adjusted EBITDA decreased 26.3% to $16.9 million, and adjusted EBITDA margin fell from 10.9% to 8.4%.

Increased G&A Expenses

General and administrative expenses increased 71.9%, driven by legal fees and compensation-related expenses.

Soft Saltwater Segment

Retail softness is particularly evident in the saltwater segment, especially in Florida, which affects more than 50% of Malibu Boats' saltwater business.

Company Guidance

During the Malibu Boats second quarter fiscal year 2025 conference call, management provided updated guidance in response to challenging market conditions. The company anticipated top-line sales to be flat to down low single digits for the year, adjusting from their original mid single-digit decline forecast. Adjusted EBITDA margins were expected to be around 10%. The company reported a 5.1% year-over-year decrease in net sales to $200.3 million, with unit volume down 11% to 1,222 units. Despite this, consolidated net sales per unit increased by 6.6% to $163.9 per unit, driven by favorable model mix and inflation-driven price increases. Adjusted EBITDA fell 26.3% to $16.9 million, reflecting an adjusted EBITDA margin decrease to 8.4% from 10.9% the prior year. Overall, Malibu Boats focused on disciplined production and dealer health to navigate the current market environment.

Malibu Boats Corporate Events

Executive/Board Changes

Malibu Boats Announces CEO Steven Menneto as President

Neutral

Feb 12, 2025

Malibu Boats, Inc. announced that Steven D. Menneto, currently the CEO and director, will be taking on the additional role of President following Ritchie L. Anderson’s departure, effective February 7, 2025. This leadership change may impact the company’s strategic direction and operations as Mr. Menneto assumes a more significant role in guiding the company’s future.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.