Best Boat Stock To Buy Now

Best Boat Stock To Buy Now: Spring inspires a flurry of boat purchases in preparation for the summer season. Interested buyers often attend the boat shows held between January and March to research and compare the features of various brands and models.

By the close of the second quarter, those sales are booked, and boat stocks often go up. From an investor’s perspective, the best time to buy boat stocks is just before the warm weather starts.

Among boat companies that are publicly traded, the market is relatively small. There are less than a dozen boat stocks worth considering. Some of the most popular include:

  • Bombardier Recreational Products (BRP) – specializes in ATVs & SXS, snowmobiles, three-wheel motorcycles, and personal watercraft

  • Brunswick – owner of many leading brands in boats, marine engines, parts, and accessories

  • Malibu Boats – manufactures a variety of recreational boats, with particular focus on watersports towboats

  • MarineMax – dealer of new, used, and brokered boats

  • Johnson Outdoors – offers an extensive collection of outdoor gear, including a variety of watercraft

  • MasterCraft Boat – manufactures luxury high-performance boats

  • Vision Marine Technologies – produces innovative electric recreational boats and outboard engines

What is the outlook for the boat sales? Are boats still in high demand? If so, of these leading companies, which is the best boat stock to buy now?

What Is The Outlook For The Boat Industry?

The recreational boat market isn’t very large, and it isn’t growing especially fast. In 2019, the global market was valued at $29 billion, and according to one market research firm, it will reach between $35 and $36 billion by 2027. That represents a compound annual growth rate (CAGR) of 5.1 percent between 2020 and 2027.

Lockdowns and economic uncertainty temporarily wiped out recreational boat sales in 2020, but the industry has since recovered. In fact, by mid-2021, it was already up nine percent over pre-pandemic levels.

Some boat manufacturers and dealers saw a dip in demand during 2022 as high inflation and rising interest rates made boat loans more expensive. During that period, used boat sales went up, but new boat sales declined.

However, companies like MasterCraft that specialize in luxury recreational boats didn’t experience reduced demand. Their client base doesn’t rely heavily on financing when making recreational boat purchases, which eliminates the challenges associated with uncertain economic conditions.

What Is The Best Boat Stock To Buy Now?

Choosing the best boat stock is tricky because the leading companies each have their own niche. That makes direct comparisons difficult. Some investors choose which boat stock to buy based on which niche is most appealing – for example, those who are interested in electric vehicle stocks lean towards Vision Marine Technologies for boating.

However, when the goal is to choose the boat stock most likely to deliver strong returns, the same selection criteria apply to boat stocks as any other company. That includes – among others – stable financials, a history of reliable performance, a wide moat, capable management, and a quality product.

Investors willing to put in the work to research potential buys can identify the best boat stocks based on whether and how the company is growing, whether the company’s intrinsic value is accurately reflected in its stock price, and related factors that prove the business is well-positioned to generate returns for shareholders.

MasterCraft Boat checks off most of the boxes that signal above-average profit potential, which puts MasterCraft stock at the top of the list in terms of the best boat stock to buy now.

Does MasterCraft Have A Moat?

MasterCraft works hard to set itself apart from other boat manufacturers by designing top tier recreational watercraft. The collection primarily includes ski, wake, and surf boats, but these aren’t the sort of beaters available for one-hour rentals in tourist areas. MasterCraft’s boats include luxury features that make every water adventure extraordinary, and they are favored by boaters who can afford the very best.

MasterCraft holds 43 patents in the United States and another six internationally. While much of its proprietary technology and special features are dedicated to comfort and convenience, MasterCraft is also known for excellence in performance and reliability. In fact, MasterCraft has earned more than 40 awards for innovation and manufacturing, and the company is known for its exceptional customer service.

A prime example of MasterCraft’s unique technology includes its Connect App, which allows owners to monitor their boats remotely. It also offers navigation and weather tools, as well as options to find nearby attractions and connect with friends. This feature, along with other conveniences exclusive to MasterCraft, puts the company in an enviable position among peers in the luxury watersports boat manufacturing industry.

How Much Is MasterCraft Boat Company Worth?

Advanced features aren’t the only reason MasterCraft has investors’ interest. The company’s financials are getting a lot of attention, too. Aside from 2020, which was a bad year for many companies, MasterCraft’s revenues have been climbing at a rapid pace. Year-over-year revenue growth since 2014 is as follows:

  • 2014 – 9.6 percent

  • 2015 – 20.7 percent

  • 2016 – 3.4 percent

  • 2017 – 3.2 percent

  • 2018 – 45.5 percent

  • 2019 – 40.2 percent

  • 2020 – (22.2 percent)

  • 2021 – 44.8 percent

  • 2022 – 34.6 percent

With this growth trajectory in mind, a look at the share price makes buying MasterCraft stock even more appealing. MasterCraft’s market cap is $545.38 million, and shares are trading around $30. The company’s P/E ratio is below 10, and analysts have determined that MasterCraft stock’s fair market value is closer to $47 per share.

It’s worth noting that other key financial figures like cash flows and profit are also solid. Overall, the data suggest a significant upside for those who buy MasterCraft stock now.

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The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.