In a report released today, Bret Jordan from Jefferies upgraded Holley (HLLY – Research Report) to a Buy, with a price target of $5.00.
Bret Jordan assigned a Buy rating to Holley’s stock due to a combination of factors.
Jordan’s optimism is primarily tied to the improved financial performance of the company, marked by Q3 sales and adjusted EBITDA figures of $156.3M and $29.7M respectively, which surpassed his estimates. This growth was driven by a favourable shift in product mix and reduced freight costs that resulted in a significant EBITDA percentage expansion. Additionally, he anticipates a sales and EBITDA surge in the fourth quarter due to favourable comparisons.
Jordan also sees potential in the company’s efforts to broaden their product portfolio aimed at non-traditional markets, thus reaching a larger customer base. The successful implementation of these strategies is expected to lead to growth in year-on-year sales. Furthermore, the company’s proactive measures in chip procurement resulted in a significant reduction in overdue electronic orders, a trend he expects to continue into the future. Holley’s strong free cash flow, along with anticipated EBITDA growth, controlled capital expenditure, and improved working capital management, are also seen as factors that will enhance the company’s financial health.
In another report released on November 9, Telsey Advisory also maintained a Buy rating on the stock with a $9.00 price target.
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Based on the recent corporate insider activity of 50 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of HLLY in relation to earlier this year.
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Holley (HLLY) Company Description:
Empower Ltd is a blank check company.
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