On Monday, DA Davidson adjusted its financial outlook for MasterCraft Boat Holdings (NASDAQ:MCFT) by reducing the stock's price target from $20.00 to $17.00, while keeping a Neutral rating on the shares. The decision follows MasterCraft's fourth-quarter earnings release, which surpassed expectations but was accompanied by a fiscal year 2025 (FY25) guidance that fell short of analysts' predictions.
MasterCraft has acknowledged the difficulties it faces in the retail sector, as well as the unpredictability in wholesale ordering patterns. This environment is expected to lead to another year of destocking for FY25. The company is also navigating challenges related to retail activity and competition, notably from the reallocated inventory of Tommy's Boats.
In light of these ongoing headwinds, DA Davidson has chosen to remain cautious with its Neutral stance on MasterCraft's stock. The new price target of $17 is derived from a price-to-earnings (P/E) multiple of 10.0 times the firm's fiscal year 2026 earnings estimate of $1.70 per share.
The lowered price target reflects DA Davidson's assessment of the company's near-term prospects in the face of a tough retail environment and the competitive pressures MasterCraft is experiencing. The firm's analysis indicates a need for caution among investors as the boat manufacturer navigates through these industry challenges.
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