On Wednesday, BRP (NASDAQ:DOOO) Inc. (DOO:CN) (NASDAQ: DOOO), a manufacturer of powersports vehicles, was downgraded by National Bank Financial from Outperform to Sector Perform. The firm also reduced its price target on the company's shares from Cdn$109.00 to Cdn$100.00. This adjustment comes as the market anticipates BRP's fiscal second-quarter results, which are scheduled for release on September 6th.
The revision in the company's outlook is attributed to a more cautious stance on the earnings forecast for both the current fiscal year and the next. This caution is due to the ongoing challenges in retail demand and the increased promotional activities within the industry. Despite the downgrade, the financial institution maintains a positive view on BRP's potential for long-term growth, highlighting the company's ability to gain additional market share and generate revenue through new product introductions.
National Bank Financial expects the current year to represent a low point for the powersports industry, suggesting a potential for recovery in the future. The firm's outlook acknowledges that BRP is well-positioned to benefit from such a market rebound due to its strategic initiatives and product innovation.
As BRP prepares to release its fiscal Q2 results in early September, the market will be looking for indicators of the company's performance and its ability to navigate the current industry headwinds. The revised price target of Cdn$100.00 reflects the firm's updated expectations based on the prevailing market conditions and the company's near-term prospects.
Investors and market watchers will be closely monitoring BRP's upcoming earnings report to gauge the effectiveness of the company's strategies in the face of a challenging retail landscape and to assess the potential impact on its financial performance.
In other recent news, BRP Inc . has been subjected to various analyst rating adjustments and price target revisions. Stifel Canada downgraded the company from Buy to Hold, citing lukewarm consumer demand and elevated inventory levels despite the launch of several new products.
Meanwhile, DA Davidson maintained its Buy rating on BRP's shares, albeit with a reduced price target of $104, following the company's decision to revise its fiscal year 2025 earnings guidance downward.
BMO Capital Markets held its Outperform rating for BRP, despite the company lowering its forecasts in response to a cautious dealer network and slowdown in retail demand. The firm believes BRP's ongoing market share gains in the Off-Road Vehicle segment and a projected earnings per share for fiscal year 2026 provide sufficient support for the stock.
Baird also maintained an Outperform rating on BRP's shares but reduced the price target to $77 following the company's guidance cut due to increased promotional spending and deeper inventory reductions. Lastly, Citi kept a Buy rating on the stock but lowered the price target to $73, reflecting a conservative stance due to potential influences on the company's performance in the upcoming year.
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