B.Riley Financial analyst Eric Wold reiterated a Buy rating on Marinemax (HZO – Research Report) today and set a price target of $45.00.
Eric Wold has given his Buy rating due to a multitude of optimistic indicators for MarineMax’s (HZO) future performance. His confidence is particularly influenced by the current demand trend and the company’s strong positioning, especially as interest rates may begin to stabilize heading into 2024. Wold perceives the high-income buyer demographic as a consistent support for demand, alongside potential improvements in margin profiles for different segments of the business. Additionally, he underscores the company’s valuable real estate portfolio as a fundamental asset underpinning the stock’s valuation and providing a safety net for investors.
The report also notes positive signs from the industry’s leading floor plan finance provider, which has revised its outlook from a slight decline to a growth in unit sales, reflecting a healthier economic landscape and better inventory management. Wold also mentions the likelihood of increased boat purchases in anticipation of rate drops, as refinancing boats is simpler than houses, indicating that buyers may not delay their purchasing decisions. With expectations of stabilizing and potentially rising boat margins, and the capacity for non-boat sales segments to exert stronger pricing power, Wold sees a clear pathway for MarineMax to enhance its financial performance. Additionally, the company’s focus on strategic acquisitions, backed by its projected high free cash flow yield and low net leverage ratio, further solidifies Wold’s Buy recommendation for HZO.
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Marinemax (HZO) Company Description:
MarineMax, Inc. engages in the provision of boating-related activities. The firm sells used and new sport boats, sport cruisers, sport yachts and fishing boats through retail stores. It also provides maintenance, repair, slip and storage services. The company was founded in January 1998 and is headquartered in Clearwater, FL.
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