Brunswick Boat Sales Picking Up With ‘Optimistic’ June Outlook

Preliminary boat sales data for May was disappointing, but Wedbush Securities said their own checks with dealers show Brunswick (BC) looks to have outperformed in many of its segments heading into the key month of June.

Citing data from Statistical Surveys Inc., or SSI, Wedbush said in a note Wednesday that total powerboat industry sales were up 2.1% in May, slower than April’s growth pace of 4%. But analysts including James Hardiman noted that May had a “much tougher comparison” from the prior year’s 9% rise.

Brunswick, the Mettawa, Illinois-based maker of boats from yachts to fishing vessels and pleasure craft, said in April that first-quarter consolidated net sales rose 7%, while adjusted earnings rose 15% to $1.01 a share.

Chief Executive Officer Mark Schwabero said at the time that even as unfavorable weather contributed to a “slightly slower start to boating activity and the marine retail selling season,” the company was “confident in our view of the industry for 2018.” Brunswick projected revenue growth in 2018 of 6% to 7%

Wedbush’s checks with boat dealers “showed mid-single-digit growth in May for Brunswick boats, an acceleration from the low single digit growth in April,” the analysts wrote. “Our contacts are optimistic about prospects for June as weather continues to improve allowing sales to close and deliveries to be made.”

Brunswick is believed to have “outperformed in the vast majority of its segments including pontoons and fiberglass outboard and cruisers,” Wedbush said. “However, we expect that BC’s aluminum fishing boats performed poorly relative to the market given the recent move by Bass Pro Shops to cut back on stock of Lowe fishing boats in favor of its in-house brands.”

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