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BRP Inc (TSE:DOO)
TSX:DOO
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BRP
(TSX:DOO)
Rating:57Neutral
Price Target:
C$83.00
▲(5.46% Upside)
Positive Factors
Analyst Rating
The analyst is upgrading the stock to a BUY rating.
Financial Performance
Management expects significant sales growth and strong improvement in earnings and adjusted EBITDA.
Financial Stability
The company's balance sheet is in excellent shape, with potential for significant free cash flow generation, leading to a strong free cash flow yield.
Negative Factors
Macroeconomic Challenges
The overall macroeconomic backdrop remains challenging, with DOO's retail expectations lowered from 'flat' last quarter to more in line with FY1Q26's -5% (ex. snowmobile).
Retail Pressure
DOO continues to face retail pressure as competitors have more non-current inventory.
Tariff Uncertainty
Tariff uncertainty limits visibility for the company's future performance.
BRP (DOO) vs. iShares MSCI Canada ETF (EWC)
Market Cap
$5.81B
Dividend Yield1.08%
Average Volume (3M)139.27K
Price to Earnings (P/E)19.7
Beta (1Y)0.91
Revenue Growth-22.34%
EPS Growth-110.04%
CountryCA
Employees16,500
SectorConsumer Cyclical
Sector Strength81
IndustryAuto - Recreational Vehicles
Share Statistics
EPS (TTM)0.47
Shares Outstanding34,512,676
10 Day Avg. Volume177,047
30 Day Avg. Volume139,274
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.06
Enterprise Value/Revenue0.79
Enterprise Value/Gross Profit3.76
Enterprise Value/Ebitda7.37
Forecast
1Y Price Target
$78.15Price Target Upside-0.70% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering10
BRP Business Overview & Revenue Model
Company DescriptionBRP (Bombardier Recreational Products Inc.) is a leading Canadian manufacturer of recreational vehicles and engines, specializing in the design, development, manufacturing, and marketing of a wide range of products including snowmobiles, personal watercraft, all-terrain vehicles (ATVs), and side-by-side vehicles. The company operates in multiple sectors, focusing on innovative outdoor products that enhance the recreational experience for consumers around the world. BRP is known for its iconic brands such as Ski-Doo, Sea-Doo, Can-Am, and Evinrude, which cater to a diverse range of outdoor enthusiasts.
How the Company Makes MoneyBRP generates revenue through the sale of its recreational vehicles and parts, accessories, and clothing. The company primarily earns money from the direct sale of its products to consumers and dealerships, with significant revenue streams coming from its seasonal products like snowmobiles and personal watercraft. Additionally, BRP benefits from recurring revenue through the sale of aftermarket parts and accessories, which are essential for the maintenance and customization of its vehicles. The company also engages in strategic partnerships and collaborations with various dealers and retailers to enhance distribution and reach a wider customer base. Seasonal demand, brand loyalty, and a strong focus on innovation further contribute to BRP's financial performance.
BRP Earnings Call Summary
Earnings Call Date:May 29, 2025
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 29, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mix of positive achievements, such as strong snowmobile retail performance and effective inventory management, alongside challenges like revenue decline and a complex international market environment. Despite a negative impact from tariffs, BRP maintains a strong financial position and anticipates a stronger second half with new product introductions.Q1-2026 Updates
Positive Updates
Record Snowmobile Retail Performance
Snowmobile retail sales were strong, up over 80% driven by favorable snow conditions, contributing to BRP slightly outperforming the North American powersport industry at retail.
Inventory Reduction Success
BRP achieved a year-over-year network inventory reduction of 21%, with double-digit declines in all product lines, positioning the company to better align wholesale with retail in the latter half of the year.
Strong Free Cash Flow Generation
The company generated a strong free cash flow of $162 million, reinforcing its solid balance sheet and financial flexibility.
Recognition for Design Excellence
BRP's design and innovation team was awarded the Red Dot Design Team of the Year 2025, aligning BRP with iconic brands like Ferrari, Apple, and Porsche.
Negative Updates
Revenue Decline
Revenue was down 8% to $1.8 billion due to lower shipments and higher sales programs, driven by softer industry trends and higher sales programs.
Challenging International Market
Demand in EMEA and Asia Pacific remained soft, with retail down 22% and 13% respectively, while the United States experienced a 6% decline in powersport retail.
Negative Impact of Tariffs
The tariff environment created uncertainty, with an estimated gross impact of $60 million to $70 million on fiscal 2026, influencing consumer confidence negatively.
Company Guidance
During the BRP Inc. FY '26 First Quarter Results Conference Call, the company reported key financial metrics, highlighting a revenue of $1.8 billion and a normalized EBITDA of $201 million, which resulted in a normalized EPS of $0.47. BRP also generated a strong free cash flow of $162 million. Despite a challenging operating environment with macroeconomic uncertainties and tariff volatility, BRP outperformed the North American Powersport industry at retail, driven by snowmobile sales, maintaining a steady performance in Canada with a 21% growth, offset by a 6% decline in the US. Internationally, retail decreased by 22% in EMEA and 13% in Asia Pacific, while Latin America experienced an 18% increase. The company is focused on rightsizing network inventory, which is down by 21% compared to last year, with a specific target of reducing seasonal product inventory by 20% by year-end. Looking ahead, BRP anticipates a stronger second half driven by new product launches and an improved inventory position, despite potential tariff-related costs estimated between $60 million and $70 million.BRP Financial Statement Overview
Summary
BRP faces financial challenges with declining revenue and profitability. High leverage and negative equity growth pose risks, but solid cash flow generation provides a buffer for navigating these pressures. Improvements in operational efficiency and debt management are needed to enhance financial stability.Income Statement
The company has experienced a decline in revenue and net income over the past year. The TTM (Trailing-Twelve-Months) data shows a negative net profit margin, indicating a challenging period. However, the gross profit margin remains positive, suggesting that the core operations still maintain some efficiency.40
Negative
Balance Sheet
The debt-to-equity ratio is high due to significant debt levels, which increases financial risk. The equity ratio is low, indicating heavy reliance on debt financing. Return on Equity (ROE) is negative, reflecting recent losses and reduced shareholder value.35
Negative
Cash Flow
Despite declining net income, the company maintains positive operating cash flow. The free cash flow is growing, which supports liquidity and potential reinvestment. However, the operating cash flow to net income ratio suggests operational challenges impacting earnings.50
Neutral
| Breakdown | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|
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 |
| EBITDA | 770.10M | 1.51B | 1.54B | 1.44B | 832.00M |
| Net Income | -213.10M | 743.40M | 863.90M | 793.90M | 363.40M |
Balance Sheet | |||||
| Total Assets | 6.29B | 6.78B | 6.46B | 5.03B | 4.89B |
| Cash, Cash Equivalents and Short-Term Investments | 260.80M | 491.80M | 324.90M | 339.40M | 1.40B |
| Total Debt | 3.13B | 2.95B | 3.02B | 2.19B | 2.65B |
| 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
Positive
78.70
Price Trends
70.41
Positive
61.35
Positive
63.28
Positive
Market Momentum
3.04
Negative
60.88
Neutral
65.14
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:DOO, the sentiment is Positive. The current price of 78.7 is above the 20-day moving average (MA) of 75.10, above the 50-day MA of 70.41, and above the 200-day MA of 63.28, indicating a bullish trend. The MACD of 3.04 indicates Negative momentum. The RSI at 60.88 is Neutral, neither overbought nor oversold. The STOCH value of 65.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:DOO.
BRP Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
61 Neutral | $17.75B | 12.51 | -5.49% | 3.06% | 1.43% | -14.10% | |
57 Neutral | $5.81B | 19.66 | 26.57% | 1.08% | -22.34% | -110.04% | |
| ― | $13.07B | 10.84 | 10.06% | 4.16% | ― | ― | |
| ― | $180.26M | 10.70 | 6.01% | 6.34% | ― | ― | |
| ― | $3.21B | 21.06 | 3.61% | 1.44% | ― | ― | |
| ― | $508.52M | 5.32 | -4.10% | 2.08% | ― | ― | |
53 Neutral | C$2.20B | ― | -26.25% | ― | 9.12% | -182.49% |
* Consumer Cyclical Sector Average
Performance Comparison
TSE:DOO
BRP
78.70
-15.63
-16.57%
MGA
Magna International
46.35
6.50
16.31%
EXCOF
Exco Technologies
4.82
-0.83
-14.69%
LIMAF
Linamar
53.55
7.42
16.08%
MRETF
Martinrea International
7.17
-1.10
-13.30%
TSE:NFI
NFI Group Inc
18.36
-0.52
-2.75%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.