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).