MasterCraft Boat Holdings, Inc. MCFT has experienced a remarkable 16.6% increase in its stock price in the past month, outpacing the industry’s 13.9% growth. The stock has also outperformed the 4.7% rise of the S&P 500.
On Tuesday, the stock closed at $20.55, below its 52-week high of $24.05 but above its 52-week low of $16.12. In the past three months, MCFT has outpaced its industry peers Malibu Boats, Inc.’s MBUU 0.4% gain, OneWater Marine Inc.’s ONEW 8.4% decline and Marine Products Corporation’s MPX 3.6% rise.
MCFT Stock’s Price Performance
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Technical indicators indicate MCFT's continued strong performance. The stock is trading above its 50-day moving average, signaling robust upward momentum and price stability. This technical strength underscores positive market sentiment and confidence in MCFT's financial health and prospects.
50-Day Moving Average
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Although this momentum might attract potential buyers, is it the right time to invest in MCFT? Let us delve deeper.
Factors Aiding MCFT’s Performance
The company has been benefiting from innovation and new products. The launch of new Model Year 2025 products, including the redesigned XStar, enhanced the company's competitive positioning in the premium ski/wake segment. Early feedback on these innovations was positive, creating excitement among dealers and consumers. The company expects the first shipments of its XStar to happen in the second half of 2025.
The new premium pontoon brand, Balise, has been steadily gaining traction in the market despite current challenges. The brand has attracted growing interest from dealers, while initial consumer feedback has been largely positive. Balise remains in its early stages of development and has been actively expanding the brand’s distribution network in targeted markets.
MasterCraft successfully reduced dealer inventories by approximately 500 units during first-quarter fiscal 2025, bringing inventory levels closer to pre-pandemic norms. This proactive rebalancing bolstered dealer health and prepared the company for a stronger second half of the fiscal year.
Robust retail performance has been aiding the company, which exceeded expectations during first-quarter fiscal 2025. Strong consumer demand and a disciplined approach to wholesale strategies supported this trend, particularly in the MasterCraft segment.
On the other hand, MasterCraft focused on aligning its cost structure with production levels and maintaining financial flexibility. The sale of the Merritt Island facility and strategic debt management strengthened the balance sheet, with cash and short-term investments exceeding debt by more than $33 million.
Looking ahead, the company has raised the lower end of its full-year guidance following strong first-quarter fiscal 2025 performance. For fiscal 2025, consolidated net sales are expected to be between $270 million and $300 million compared with the prior estimate of $265-$300 million. Adjusted EBITDA is expected to be between $17 million and $26 million compared with the earlier estimate of $15-$26 million.
On the other hand, adjusted earnings per share are forecasted between 55 cents and 95 cents, up from the earlier estimate of 36 cents and 87 cents. This incremental increase in earnings per share indicates reduced interest expenses and taxes. Capital expenditures for the year are anticipated to remain around $12 million.
For the second quarter of fiscal 2025, the company expects consolidated net sales of approximately $60 million, with adjusted EBITDA near $1 million and an adjusted loss per share of about 1 cent.
The lower wholesale shipments planned for the first half of the fiscal year align with the company’s strategic focus on reducing inventory levels. Production is set to ramp up in the second half to support the launch of new product initiatives and meet seasonal demand.
Estimate Revision Favoring the MCFT Stock
The Zacks Consensus Estimate for fiscal 2025 and 2026 witnessed upward revisions of 15.4% and 4.6% to 75 cents and $1.58, respectively.
MCFT Trades at a Discount
MCFT is currently valued at a discount compared with the industry on a forward 12-month P/S basis. MCFT’s forward 12-month price-to-sales ratio is 1.11, significantly lower than the industry.
P/S (F12M)
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What May Pull Back the Stock's Momentum?
Dealers have been maintaining conservative ordering patterns, influenced by elevated inventory carrying costs and market uncertainties. This cautious stance is particularly evident in the off-peak season. The pontoon market has seen higher-than-optimal inventories. The industry remains highly promotional, particularly in the pontoon category, which has weighed on pricing power and margins. This competitive environment is expected to persist through the upcoming boat show season.
Final Thought for MCFT Stock
MasterCraft presents an attractive investment opportunity due to its strong market momentum, strategic innovation and disciplined operational execution. The company’s launch of innovative products, like the redesigned XStar and the Balise premium pontoon brand, has bolstered its competitive positioning and received positive consumer and dealer feedback.
However, challenges persist, including cautious dealer ordering patterns, elevated inventory levels in the pontoon segment and a highly promotional competitive landscape pressuring margins. While MCFT’s discounted valuation compared with industry peers and positive momentum support a hold recommendation for existing investors, new purchases should be restricted until market uncertainties ease and its operational improvements fully materialize. The company currently has a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
