Analyst Note| Jaime M. Katz |
We don’t plan any material change to our $100 fair value estimate for narrow-moat Malibu after incorporating second-quarter results into our model. Total sales rose 28%, to $339 million, edging our $313 million forecast, with strength across the firm’s portfolio (Malibu units up 12%, Cobalt and Saltwater up mid-20%). For the enterprise, unit shipments ticked up 18% while pricing jumped 9% as consumers continued to drift toward higher amenity products. Strong pricing persisted across all three segments, with Malibu average selling prices up 6%, Cobalt up 9%, and saltwater 11% higher. Unfortunately, expenses were a bit higher than we forecast due to inflationary costs (input and labor), sending the gross margin down 180 basis points, to 22.3% versus our 24% estimate. This ultimately led to a 17% adjusted EBITDA margin, representing a 120-basis-point downtick over last year.