Let’s dig into the relative performance of American Outdoor Brands (NASDAQ:AOUT) and its peers as we unravel the now-completed Q3 leisure products earnings season.
Leisure products cover a wide range of goods in the consumer discretionary sector. Maintaining a strong brand is key to success, and those who differentiate themselves will enjoy customer loyalty and pricing power while those who don’t may find themselves in precarious positions due to the non-essential nature of their offerings.
The 14 leisure products stocks we track reported a slower Q3. As a group, revenues beat analysts’ consensus estimates by 0.6% while next quarter’s revenue guidance was 1.1% below.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 5.1% since the latest earnings results.
Best Q3: American Outdoor Brands (NASDAQ:AOUT)
Spun off from Smith and Wesson in 2020, American Outdoor Brands (NASDAQ:AOUT) is an outdoor and recreational products company that offers firearms and firearm accessories.American Outdoor Brands reported revenues of $60.23 million, up 4% year on year. This print exceeded analysts’ expectations by 13.1%. Overall, it was an incredible quarter for the company with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
American Outdoor Brands scored the highest full-year guidance raise of the whole group. Unsurprisingly, the stock is up 37.3% since reporting and currently trades at $14.97.
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Malibu Boats (NASDAQ:MBUU)
Founded in California in 1982, Malibu Boats (NASDAQ:MBUU) is a manufacturer of high-performance sports boats and luxury watercrafts.Malibu Boats reported revenues of $171.6 million, down 32.9% year on year, outperforming analysts’ expectations by 2.6%. The business had a stunning quarter with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 12.1% since reporting. It currently trades at $37.13.
Weakest Q3: Clarus (NASDAQ:CLAR)
Initially a financial services business, Clarus (NASDAQ:CLAR) designs, manufactures, and distributes outdoor equipment and lifestyle products.Clarus reported revenues of $67.12 million, down 17.4% year on year, falling short of analysts’ expectations by 8.1%. It was a disappointing quarter as it posted full-year revenue guidance missing analysts’ expectations.
Clarus delivered the weakest full-year guidance update in the group. As expected, the stock is down 7.4% since the results and currently trades at $4.40.
YETI (NYSE:YETI)
Founded by two brothers from Texas, YETI (NYSE:YETI) specializes in durable outdoor goods including coolers, drinkware, and other gear tailored to adventure enthusiasts.YETI reported revenues of $478.4 million, up 10.4% year on year. This number surpassed analysts’ expectations by 1.5%. Overall, it was a satisfactory quarter as it also recorded a decent beat of analysts’ EPS estimates.
YETI achieved the fastest revenue growth among its peers. The stock is up 6.6% since reporting and currently trades at $38.51.
Latham (NASDAQ:SWIM)
Started as a family business, Latham (NASDAQ:SWIM) is a global designer and manufacturer of in-ground residential swimming pools and related products.Latham reported revenues of $150.5 million, down 6.4% year on year. This result lagged analysts' expectations by 1.1%. Aside from that, it was a mixed quarter as it also produced a solid beat of analysts’ adjusted operating income estimates but full-year revenue guidance missing analysts’ expectations.
The stock is up 5% since reporting and currently trades at $6.90.
Market Update
Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market has thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% each in November and December), and a notable surge followed Donald Trump's presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by the pace and magnitude of future rate cuts as well as potential changes in trade policy and corporate taxes once the Trump administration takes over. The path forward is marked by uncertainty.Want to invest in winners with rock-solid fundamentals? Check out our and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
This content was originally published on Stock Story
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