Malibu Boats (MBUU) Stock Forecast & Price Target

Malibu Boats has positioned itself advantageously within a growing market, benefitting from increasing interest in the ski/wake boat segment, which the company has significantly influenced. The company's forecasts indicate approximately 11% sales growth in FY26, supported by a rebound in volumes and stable price growth, alongside substantial free cash flow generation, attributed to its variable cost structure. With inventory normalizing and operational efficiencies enhancing margins, Malibu's performance in the current marine industry’s positive cycle is expected to yield robust financial returns moving forward.

Malibu Boats has revised its growth guidance, shifting from an expected flat-to-low single-digit growth to a forecasted decline in year-over-year performance, with industry volume trends deteriorating closer to a 10-12% downturn. Despite managing to maintain gross profit levels, the company experienced a significant 26.3% drop in adjusted EBITDA, alongside a 5.1% decrease in adjusted net sales, leading to a forecasted decline in sales for FY25 and decreased profitability metrics. The negative outlook is exacerbated by external economic pressures such as declining consumer confidence, rising gas prices, and increased unemployment, all of which are projected to adversely impact unit sales and overall financial performance.