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Malibu Boats Inc Class A MBUU

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Morningstar’s Analysis

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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Malibu Projects Healthy Sales, EBITDA Metrics Despite Supply Chain Constraints; Shares Undervalued

Jaime M. Katz, CFA Senior Equity Analyst

Analyst Note

| Jaime M. Katz, CFA |

We plan to lift our $97 fair value estimate for narrow-moat Malibu by a high-single-digit rate as we incorporate updated fourth-quarter results and a tweaked fiscal 2022 outlook, and view shares as attractive. Fourth-quarter sales were modestly ahead of our outlook, at $276 million (up 133% against COVID-19-related shutdowns last year). Even against the unconstrained fourth quarter of 2019, sales rose 42%, lifted by the acquisition of Maverick and consumer pivot to larger boats with more features. Total unit volume rose 111% while average selling prices grew 11%, to $117.60, skewed by higher-priced saltwater units representing a larger part of the total mix (46% of sales). Adjusted operating expenses were well managed, down 50 basis points (to 8.7%) from 2019 levels, which allowed Malibu to clock an adjusted EBITDA margin of 20.8%, the highest fourth-quarter mark since the firm went public (2014).

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Company Profile

Business Description

Malibu Boats is a leading designer and manufacturer of power boats in the United States. It is the market leader in performance sport boats, sold under its Malibu and Axis brands. It acquired Cobalt Boats, a leading producer of sterndrive boats, in 2017 number-one market share position in the U.S. in the 24-foot to 29-foot segment), and Pursuit Boats, which makes high-end offshore and outboard motorboats in 2018. In 2021, it purchased Maverick Boat Group, a leading seller of flat fishing boats, with exposure to bay, dual-console, and center-console boats. Malibu has also expanded into boat trailers and accessories, and in 2020 began producing its own engines for its performance sport boats. Malibu’s target market includes a wide range of water enthusiasts who embrace active lifestyles.

Contact
5075 Kimberly Way
Loudon, TN, 37774
T +1 865 458-5478
Sector Consumer Cyclical
Industry Recreational Vehicles
Most Recent Earnings Jun 30, 2021
Fiscal Year End Jun 30, 2022
Stock Type Cyclical
Employees 2,645

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