BRP logged a 1.8% change during today's afternoon session, and is now trading at a price of $75.34 per share. The S&P 500 index moved 1.0% and the Nasdaq posted a 1.0% change.
BRP shares moved -10.8 over the last 52 weeks, with a high of $90.42 and a low of $58.71. BRP Inc., together with its subsidiaries, designs, develops, manufactures, distributes, and markets powersports vehicles and marine products in North America, Europe, Australia, New Zealand, and Latin America. The mid-cap Consumer Cyclical company has 23,000 full time employees and is based in Valcourt, Canada. BRP has returned a 0.9% dividend yield over the last 12 months.
Exceptional EPS Growth with Healthy Leverage Levels:
| 2020-01-31 | 2021-01-31 | 2022-01-31 | |
|---|---|---|---|
| Revenue (MM) | $6,053 | $5,953 | $7,648 |
| Revenue Growth | n/a | -1.65% | 28.47% |
| Gross Margins | 24.0% | 24.7% | 27.9% |
| Gross Margins Growth | n/a | 2.92% | 12.96% |
| Operating Margins | 9.5% | 11.2% | 15.4% |
| Operating Margins Growth | n/a | 17.89% | 37.5% |
| Net Margins | 6.14% | 6.1% | 10.38% |
| Net Margins Growth | n/a | -0.65% | 70.16% |
| Earnings Per Share | $3.96 | $4.1 | $7.69 |
| EPS Growth | n/a | 3.54% | 87.56% |
| Diluted Shares (MM) | 94 | 89 | 37 |
| Free Cash Flow (MM) | $225 | $674 | $72 |
| FCF Growth | n/a | 199.96% | -89.28% |
| Capital Expenditures (MM) | -$331 | -$280 | -$698 |
| Net Debt / EBITDA | 1.99 | 1.17 | 1.28 |
BRP Is Reasonably Valued:
Compared to the Consumer Cyclical sector's average of 22.33, BRP has a trailing twelve month P/E ratio of 9.8 and, according to its EPS guidance of 10.03, an expected P/E ratio of 7.5. BRP's PEG ratio is 0.24 based on its 40.67% annual average growth rate of historical and projected earnings per share. However, we believe that it is more prudent to calculate the PEG ratio using the broader market's 5-year expected EPS growth rate of 13.05%, because the growth rate implied by BRP's past and expected EPS is probably not sustainable. This more prudent approach shows a PEG ratio of 0.75, which still suggests that company's shares are possibly undervalued.
BRP's P/B ratio is 11.1 compared to its sector average of 3.12. The company is likely overvalued in terms of its equity.
BRP's elevated P/B ratio notwithstanding, the company's strong cash flows, decent earnings multiple, and healthy debt levels factor towards it being fairly valued.
Most of the Market Indicators on BRP Are Negative:
3 analysts are following BRP and have set target prices ranging from $85.36 to $132.96 per share. On average, they have given the company a rating of buy. At the current price of $75.34, DOOO is trading -29.31% away from its average analyst target price of $106.58 per share, implying an analyst consensus of strong upside potential for the stock.
