Boating Industry Intelligence You Can Profit From
NEW YORK, N.Y. – Analysts from Bank of America Securities aren’t very optimistic about the short-term outlook for the marine industry or any powersports market, for that matter.
“August trends continued to be very soft for Harley, Polaris and Brunswick,” the company reported in a recent statement. “ … we believe a tougher lending market along with a housing downturn will increasingly affect demand for all powersports vehicles. We have reduced our powersports price targets for the second consecutive month.”
Bank of America Securities analysts suggested that retail boat sales declines appear to have continued in August.
“Not surprisingly, our checks indicated concerns over the housing downturn and tightening credit environment; as Florida and California continued to be very weak,” they commented. “We have lowered our target on Brunswick Corp. shares to $25 from $27.”
The analysts added, “We believe housing downturn and credit crunch may further impact the demand for boats and a recovery will likely get pushed further out.”
The company revisited Brunswick management’s recent comments that “2007 may be the weakest year since 1965, based on unit sales.”
“The current expectation in 2007 for industry boat retail sales is roughly 260,000 units, which is below the lowest level of 277,000 units in early 90s, and 11 percent less than the 296,000 units sold in 2003, the last trough year,” stated the analysts. “We believe factors such as the housing slowdown, increased incidents of mortgage defaults, growth in used boat market and low consumer sentiment, are affecting the overall marine industry.”
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