CA - BRP upgraded to Buy as DA Davidson sees market share gains

2023-06-13 09:07:55 ET

Sea-Doo manufacturer BRP Inc. ( NASDAQ: DOOO ) was raised to Buy at DA Davidson as the firm sees strong sales growth versus Polaris ( PII ).

Equity analyst Brandon Rolle said that recent channel checks have revealed strong sales into the start of the summer while conversations with dealers revealed “promotional support spurred strong market share gains” over the course of the spring.

“We would also note our checks indicate of June ORV retail trends and market share dynamics have continued through mid-June. Given what we’ve seen in our checks since April, it appears market share dynamics have shifted back to what we saw in a normalized pre-pandemic retail environment, where BRP consistently gained the most ORV market share despite not offering the greatest retail incentives,” Rolle told clients. “From a mix perspective, dealers continue to indicate entry-level demand has been impacted by the elevated interest rate environment, but more affluent customers are still looking for premium units and multi-line dealers believe BRP’s innovation is driving share gains within the premium segment.”

Rolle raised his price target to C$121 from a prior C$111. The shift back to Buy comes just over two months after Rolle stepped to the sidelines on the name. Shares of BRP ( DOOO ) rose 0.6% before the bell on Tuesday.

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