Why Is Boat Dealers Company MarineMax Stock Sinking Today?

MarineMax, Inc. HZO shares are trading lower on Thursday. The company announced first-quarter revenues of $527.27 million, beating the analyst consensus of $521.28 million.

The 4% top-line growth was driven largely by higher new and used boat sales, contributing to a 4% increase in same-store sales. The company reported adjusted earnings of $0.19 per share, missing the analyst consensus of $0.50. 

Gross profit decreased 6.1% to $175.5 million from $186.9 million in the prior-year period. Gross profit margin of 33.3% decreased 350 basis points from 36.8% in the fiscal 2023 first quarter, primarily as the result of a more aggressive promotional environment in response to retail environment challenges during the 2024 first quarter.

The adjusted EBITDA for the quarter ending December 31, 2023, was $26.6 million, compared with $53.2 million for the same period last year. The company exited the quarter with cash and equivalents worth $210.32 million.

Brett McGill, Chief Executive Officer and President of MarineMax, stated, “Our pricing actions did result in lower gross margins and profitability. This was primarily due to increased discounting on certain boat models in response to the softer retail environment, as well as a greater mix of larger boats, which historically carry a lower gross margin than other product categories.”

Outlook: MarineMax lowered its FY24 adjusted EPS forecast to $3.20-$3.70 from the prior outlook of $4.50-$5.00 (vs. consensus of $4.55).

The company also revised fiscal year 2024 Adjusted EBITDA guidance to $190 million-$215 million.

Price Action: HZO shares are trading lower by 17.26% to $27.47 on the last check Thursday.