BRP (DOO) AI Stock Analysis

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BRP

(TSX:DOO)

48Neutral

BRP Inc. faces significant financial and operational challenges, with declining revenue and profitability impacting its financial performance. Although the company has taken strategic actions to manage inventory and introduce new products, high debt levels and market uncertainties weigh heavily. The technical indicators suggest a bearish trend, and valuation metrics reflect the company's struggles with profitability. Despite some positive steps highlighted in the earnings call, the overall outlook remains cautious.

Positive Factors

Business focus

BRP is focusing on its core Powersports activities by selling its marine businesses, which are expected to offer attractive value creation opportunities for a new owner.

Financial runway

Grants and loans are expected to extend the company's financial runway.

Negative Factors

Marine segment performance

BRP's marine segment is on track to incur significant losses, which underscores the challenges in that division.

Tariff impact

Tariff uncertainty limits visibility for the company's future performance.

BRP (DOO) vs. S&P 500 (SPY)

Market Cap

$3.71B

Dividend Yield1.71%

Average Volume (3M)196.43K

Price to Earnings (P/E)19.7

Beta (1Y)0.92

Revenue Growth-23.54%

EPS Growth-130.34%

CountryCA

Employees16,500

SectorConsumer Cyclical

Sector Strength55

IndustryAuto - Recreational Vehicles

Share Statistics

EPS (TTM)-2.92

Shares Outstanding34,512,398

10 Day Avg. Volume263,421

30 Day Avg. Volume196,426

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.45

Price to Cash Flow (P/CF)5.40

P/FCF Ratio14.40

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

C$65.63

Price Target Upside38.84% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering14

BRP Business Overview & Revenue Model

Company DescriptionBRP Inc., together with its subsidiaries, designs, develops, manufactures, distributes, and markets powersports vehicles and marine products in the United States, Canada, Europe, the Asia Pacific, Mexico, Austria, and internationally. The company operates through two segments, Powersports and Marine. It offers all-terrain, side-by-side, and three-wheeled vehicles; seasonal products, such as snowmobiles and personal watercraft; and engines for jet boats, outboards, karts, motorcycles, and recreational aircraft. The company also provides parts, accessories, and apparel, as well as other services. It sells its products through a network of independent dealers and distributors, as well as to original equipment manufacturers. The company was formerly known as J.A. Bombardier (J.A.B.) Inc. and changed its name to BRP Inc. in April 2013. BRP Inc. was founded in 1937 and is headquartered in Valcourt, Canada.

How the Company Makes MoneyBRP generates revenue primarily through the sale of its diverse range of recreational vehicles and powersport products. The company capitalizes on its strong brand portfolio and innovative product development to drive sales across various market segments. Key revenue streams include the sale of vehicles, parts, accessories, and services. Additionally, BRP engages in strategic partnerships and alliances that enhance its distribution network and market reach, further contributing to its earnings. The company also benefits from a robust aftermarket business, offering accessories and parts that support consumer product customization and maintenance, thereby ensuring a steady stream of revenue beyond initial sales.

BRP Financial Statement Overview

Summary

BRP is facing financial challenges with declining revenue and profitability, leading to a negative net income. The company's high debt levels pose a risk, although it retains some cash generation capability through positive free cash flow. Improvement in operational efficiency and revenue growth is needed to enhance financial stability.

Income Statement

Neutral

The company experienced a significant decline in total revenue from $10.37 billion in 2024 to $7.83 billion in 2025, representing a sharp decrease. Gross profit margin remained relatively stable at 22.65% in 2025, down from 25.10% in 2024. However, the net income turned negative in 2025, showing a net loss, which is concerning. EBIT and EBITDA margins also declined, indicating operational challenges.

Balance Sheet

Neutral

The balance sheet shows a concerning trend with a decline in stockholders' equity, which is now very low compared to total assets. The debt-to-equity ratio is extremely high, indicating significant leverage and potential financial risk. The equity ratio is low, suggesting a reliance on debt financing. However, total assets have been relatively stable.

Cash Flow

Neutral

Operating cash flow decreased significantly from $1.66 billion in 2024 to $740 million in 2025, reflecting operational difficulties. Free cash flow also decreased but remained positive, indicating some ability to generate cash. The free cash flow to net income ratio is not meaningful due to the negative net income.

Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Breakdown
Income Statement		Total Revenue
7.83B	10.37B	10.03B	7.65B	5.95B
	Gross Profit
1.77B	2.60B	2.50B	2.13B	1.47B
	EBIT
551.70M	1.16B	1.37B	1.19B	465.60M
	EBITDA
770.10M	1.51B	1.54B	1.44B	832.00M
	Net Income Common Stockholders
-213.10M	743.40M	863.90M	793.90M	363.40M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
260.80M	491.80M	324.90M	339.40M	1.40B
	Total Assets
6.29B	6.78B	6.46B	5.03B	4.89B
	Total Debt
3.13B	2.95B	3.02B	2.19B	2.65B
	Net Debt
2.95B	2.46B	2.81B	1.92B	1.32B
	Total Liabilities
6.05B	5.96B	5.92B	5.16B	5.36B
	Stockholders Equity
241.30M	808.90M	534.90M	-135.60M	-478.70M
Cash Flow		Free Cash Flow
313.70M	1.07B	-9.90M	72.30M	674.30M
	Operating Cash Flow
740.10M	1.66B	649.50M	770.00M	954.20M
	Investing Cash Flow
-425.50M	-574.90M	-853.40M	-687.70M	-260.30M
	Financing Cash Flow
-553.10M	-629.20M	190.30M	-1.14B	583.80M

BRP Technical Analysis

Technical Analysis Sentiment

Negative

Last Price47.27

Price Trends

50DMA

57.42

Negative

100DMA

64.71

Negative

200DMA

74.54

Negative

Market Momentum

MACD

-2.87

Positive

RSI

33.00

Neutral

STOCH

10.25

Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:DOO, the sentiment is Negative. The current price of 47.27 is below the 20-day moving average (MA) of 52.34, below the 50-day MA of 57.42, and below the 200-day MA of 74.54, indicating a bearish trend. The MACD of -2.87 indicates Positive momentum. The RSI at 33.00 is Neutral, neither overbought nor oversold. The STOCH value of 10.25 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:DOO.

BRP Peers Comparison

Overall Rating

UnderperformOutperform

Sector (59)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WTE	75 Outperform	C$1.41B	12.27	15.84%	6.59%	7.98%	-0.29%
MTL	73 Outperform	C$1.08B	9.61	11.27%	6.51%	-0.27%	-15.99%
Sector *	59 Neutral	$11.74B	10.16	-1.06%	4.15%	1.27%	-16.61%
DOO	48 Neutral	$3.71B	19.66	-3.01%	1.71%	-23.54%	-130.34%

* Consumer Cyclical Sector Average

Performance Comparison

TSE:DOO

BRP

52.63

-45.78

-46.52%

CNI

Canadian National Railway

98.32

-30.09

-23.43%

Canadian Pacific Kansas City

73.18

-14.28

-16.33%

TFII

TFI International

82.44

-74.27

-47.39%

TSE:MTL

Mullen Group Ltd.

12.67

-1.44

-10.21%

TSE:WTE

Westshore Terminals

22.77

-0.97

-4.09%

BRP Earnings Call Summary

Earnings Call Date: Mar 26, 2025 | % Change Since: -6.51% | Next Earnings Date: May 29, 2025

Earnings Call Sentiment Neutral

BRP's earnings call reflects a company that has strategically managed its inventory and maintained its leadership in the Powersports market despite facing significant challenges, including decreased revenue, market uncertainties, and tariff impacts. The company's operational efficiency and new product introductions are positive steps toward long-term success, but current market conditions and geopolitical issues present significant hurdles.

Highlights

Lean Inventory Management

Successfully reduced network inventory by 13%, or 18% excluding Snowmobile, aligning with the objective of 15% to 20% reduction. This positions BRP well for future market opportunities.

Powersports Leadership

BRP became the number one OEM in Powersports in North America, gaining significant market share in various segments such as side-by-side (11 points) and ATV (4 points) compared to pre-COVID levels.

Operational Efficiency

Achieved over $200 million in lean savings for the year, contributing to improved operational efficiency despite a challenging year.

Strong Product Introduction

Introduction of several new models and expansion into new segments, including the launch of the Can-Am electric motorcycle.

Lowlights

Decreased Revenue and Retail Performance

Revenue was down 20% to $2.1 billion in Q4, with retail for North American Powersports down 21%, particularly affecting ORV and Snowmobile segments.

Tariff Impact and Market Uncertainty

Estimated $40 million impact from tariffs affecting business costs, with ongoing geopolitical and tariff disputes creating uncertainty in market demand and operating environments.

Challenging Snowmobile Market

Snowmobile retail was down low 30% in Q4 due to late snowfall, resulting in market share loss in North America.

High Non-Current Inventory Levels

BRP faced challenges with high non-current inventory levels across the industry, affecting competitiveness and market share in the first half of fiscal 2026.

Company Guidance

During BRP Inc.'s Fiscal Year 2025 Fourth Quarter Results Conference Call, guidance was given that emphasized various metrics and strategic directions for the coming year. The company reported $7.8 billion in revenue and a normalized EBITDA of $1 billion, with a normalized EPS of $4.68, all within the revised guidance range. BRP highlighted a significant achievement in reducing network inventory levels by 13% overall, and by 18% when excluding snowmobiles, which lagged due to softer retail in the fourth quarter. North American Powersports inventory was reduced by 18%, aligning with their target of a 15% to 20% reduction. For Fiscal Year 2026, BRP aims to focus on their core Powersports business, with expectations for revenue growth driven by improved ORV shipments and new product introductions. The company reported a net leverage ratio of 2.6 times and generated over $450 million in free cash flow, allowing for $62 million in dividend payments and $215 million in share repurchases. However, due to the ongoing tariff disputes and unpredictable operating environments, BRP refrained from issuing precise guidance for Fiscal Year 2026.

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.