Summer is fast approaching and, with most states still in lockdown, it's expected that physical distancing measures may well but a damper on many people's plans.
There's one summer activity that's seen a distinct pickup, however, as those living near water can take part in boating while still practicing social distancing. Boat retailers are seeing an uptick in sales, with low interest rates and low fuel costs also spurring demand.
Below is a chart of Malibu Boats Inc. (MBUU), a company that designs, manufactures and sells performance sports boats. The company reported earnings a week ago that were ahead of estimates and, while management withdrew their guidance for the remainder of the year, the company stated that they have ample liquidity to ride out any pandemic-related road bumps.
DAILY CHART OF MALIBU BOATS (MBUU)
MBUU's quarterly earnings report, coupled with the company's comments regarding continued production plans amid renewed demand, has analysts raising their estimates going forward. The average price target for the stock is 18% above its current price.
Other select companies are also seeing demand pick up for their services and goods in the face of a global pandemic. Whether these companies are helping keep locked-down people connected, fed or entertained, the growth in sales is real. And, for many, this growth is expected to continue even as states and countries begin to reopen.
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Warmly,
Mary Ellen McGonagle,
