Sales Slowdown and Declining Stock Prices for MasterCraft Boat Holdings
Shares of MasterCraft Boat Holdings have taken a hit in premarket trading due to a rapid slowdown in boat sales caused by higher interest rates and increased dealer inventory. The company's sales dropped by almost 16% in the fiscal fourth quarter, an...
Troy D. Hanson
August 30, 2023
Shares of MasterCraft Boat Holdings have taken a hit in premarket trading, with the boat maker issuing a warning about a rapid slowdown in boat sales. This decline is attributed to higher interest rates and an increase in dealer inventory.
In the premarket session, the stock has slid 16% to $21.00 per share. Unfortunately, this comes as a further blow to the company, as shares were already down 3.5% since the start of the year.
Although MasterCraft Boat Holdings reported better-than-feared results for the fiscal fourth quarter that ended on June 30, sales still dropped by almost 16%. Chief Executive Fred Brightbill acknowledged that retail sales showed signs of slowing throughout the quarter.
Looking ahead to the current fiscal year, MasterCraft is expecting a significant decline in sales. They are targeting a range of $390 million to $420 million, representing a year-over-year drop of approximately 41% to 37%. This projection falls below analysts' expectations, as they were initially anticipating fiscal 2024 sales of $573.1 million, according to FactSet.
Additionally, the company is forecasting adjusted earnings of $1.46 to $1.88 per share, down from $5.35 per share in fiscal 2023.
Brightbill cited various macroeconomic factors contributing to the uncertainty faced by MasterCraft Boat Holdings, including elevated interest rates and tightening credit standards and availability. In response, the company has developed plans to address different scenarios regarding retail demand.
It remains to be seen how MasterCraft Boat Holdings will navigate these challenges and work towards revitalizing sales and earnings.