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Holley (HLLY)
NYSE:HLLY
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Holley
(NYSE:HLLY)
52Neutral
Positive Factors
Earnings
Holley Performance Brands delivered Q1 results that beat expectations on the top-line, with sales approximately 3% above consensus.
Market Share
Holley captured market share in Q1.
Product Innovation
Management has increased new product development capital expenditures, indicating a focus on innovation and growth.
Negative Factors
Economic Environment
FY25 guidance reflects a soft macro environment, which poses challenges despite the company's core product focus and reinvestment efforts.
Investor Sentiment
Shares are down some 9% as investors were likely looking for more clarity around the impact of tariffs and the company’s sourcing exposure by country.
Tariffs
Guidance excludes the impact of tariffs, which contributed to the stock's underperformance.
Holley (HLLY) vs. S&P 500 (SPY)
Market Cap
$261.50M
Dividend YieldN/A
Average Volume (3M)571.05K
Price to Earnings (P/E)18.6
Beta (1Y)1.14
Revenue Growth-7.66%
EPS Growth-227.74%
CountryUS
Employees1,467
SectorConsumer Cyclical
Sector Strength58
IndustryAuto - Parts
Share Statistics
EPS (TTM)0.02
Shares Outstanding118,865,190
10 Day Avg. Volume437,366
30 Day Avg. Volume571,055
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap3.41
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit3.74
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$3.33Price Target Upside72.54% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
Holley Business Overview & Revenue Model
Company DescriptionHolley Inc. designs, manufactures, and markets automotive aftermarket products for car and truck enthusiasts in the United States, Canada, Europe, and China. The company's products include carburetors, fuel pumps, fuel injection systems, nitrous oxide injection systems, superchargers, exhaust headers, mufflers, distributors, ignition components, engine tuners, automotive performance plumbing products, and exhaust products as well as shifters, converters, transmission kits, transmissions, tuners, and automotive software. It also offers wheels, chassis and suspension products, helmets, head and neck restraints, seat belts, firesuits, and electronic control and monitoring systems. The company sells its products under the Holley, Holley EFI, APR, MSD, Flowmaster, Powerteq, Accel, and Simpson brands to retailers directly, as well as through distributors and online channel. The company was founded in 1903 and is headquartered in Bowling Green, Kentucky.
How the Company Makes MoneyHolley Inc. generates revenue primarily through the sale of its high-performance automotive parts and accessories. The company markets its products directly to consumers via its e-commerce platform and through a network of independent distributors and retailers. Key revenue streams include sales from its performance products like carburetors and fuel systems, which are popular among car enthusiasts looking to enhance vehicle performance. Additionally, Holley has established partnerships with automotive racing teams and events, which help to bolster its brand reputation and visibility within the racing community. This, in turn, drives sales growth. The company also benefits from a diverse portfolio of brands under its umbrella, allowing it to reach a wide range of customers across different segments of the automotive aftermarket industry.
Holley Financial Statement Overview
Summary
Holley's financial performance is mixed, with significant challenges in profitability and revenue growth, as indicated by the income statement. The balance sheet benefits from a debt-free status, enhancing stability, but asset and equity declines pose risks. Cash flow management shows resilience in generating free cash flow, although reduced operating cash flow is a concern. Overall, while there are strengths in the financial structure, operational performance and growth appear constrained.Income Statement
Holley's income statement shows a decline in revenue over the TTM period, with a significant decrease in net income, resulting in a negative net profit margin. The gross profit margin remains relatively stable, but operating margins have contracted. The revenue growth rate is negative compared to the previous year, indicating challenges in sales performance. Overall, profitability is under pressure, affecting the score negatively.―
Balance Sheet
The balance sheet reflects a strong equity position with no total debt in the TTM period, improving the debt-to-equity ratio significantly. The equity ratio is relatively healthy, indicating a stable financial structure. However, the decrease in total assets and stockholders' equity compared to the previous year highlights potential concerns over asset management and shareholder value.65
Cash Flow
Cash flow from operations has decreased compared to the previous year, but the company maintains positive free cash flow. The free cash flow to net income ratio is favorable, indicating efficient cash generation relative to earnings. However, the overall cash position is weakened by declining operating cash flow, impacting the score moderately.―
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 602.22M | 659.70M | 688.41M | 692.85M | 504.18M | Gross Profit |
| 238.54M | 256.09M | 253.66M | 286.81M | 208.24M | EBIT |
| 14.67M | 94.04M | 50.74M | 126.98M | 85.45M | EBITDA |
| 54.10M | 117.51M | 148.95M | 152.47M | 104.42M | Net Income Common Stockholders |
| -23.23M | 19.18M | 73.77M | -27.14M | 32.86M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 56.09M | 41.08M | 26.15M | 36.33M | 71.67M | Total Assets |
| 1.13B | 1.20B | 1.25B | 1.19B | 1.07B | Total Debt |
| 557.91M | 615.46M | 655.67M | 637.67M | 674.99M | Net Debt |
| 501.82M | 574.38M | 629.52M | 601.35M | 603.31M | Total Liabilities |
| 712.17M | 762.19M | 833.65M | 888.57M | 824.95M | Stockholders Equity |
| 421.15M | 441.15M | 415.99M | 304.49M | 240.38M |
| Cash Flow | Free Cash Flow | |||
| 40.09M | 82.16M | -390.00K | 6.71M | 78.93M | Operating Cash Flow |
| 46.90M | 88.09M | 12.31M | 21.58M | 88.41M | Investing Cash Flow |
| 2.02M | -4.45M | -25.04M | -134.09M | -165.62M | Financing Cash Flow |
| -34.60M | -69.01M | 2.85M | 77.16M | 140.54M |
Holley Technical Analysis
Negative
1.93
Price Trends
2.36
Negative
2.65
Negative
2.83
Negative
Market Momentum
-0.11
Positive
37.84
Neutral
24.02
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HLLY, the sentiment is Negative. The current price of 1.93 is below the 20-day moving average (MA) of 2.10, below the 50-day MA of 2.36, and below the 200-day MA of 2.83, indicating a bearish trend. The MACD of -0.11 indicates Positive momentum. The RSI at 37.84 is Neutral, neither overbought nor oversold. The STOCH value of 24.02 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HLLY.
Holley Risk Analysis
Holley disclosed 57 risk factors in its most recent earnings report. Holley reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Holley Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $589.01M | 9.04 | 26.52% | 4.61% | 1.14% | 127.04% | |
74 Outperform | $146.86M | 8.79 | 8.16% | ― | 7.69% | 7934.59% | |
73 Outperform | $619.86M | 10.86 | 9.00% | 4.18% | 13.53% | -4.76% | |
63 Neutral | $177.82M | ― | -6.40% | ― | 4.26% | 64.64% | |
61 Neutral | $6.59B | 11.77 | 3.06% | 3.98% | 2.56% | -20.85% | |
52 Neutral | $261.50M | 18.60 | -5.39% | ― | -7.66% | -227.74% | |
48 Neutral | $74.98M | ― | -89.61% | ― | -8.51% | 9.63% |
* Consumer Cyclical Sector Average
Performance Comparison
HLLY
Holley
1.93
-2.06
-51.63%
PLOW
Douglas Dynamics
26.75
2.59
10.72%
MPAA
Motorcar Parts Of America
9.82
4.75
93.69%
SMP
Standard Motor Products
28.61
-2.74
-8.74%
STRT
Strattec Security
36.60
12.85
54.11%
SUP
Superior Industries International
2.87
-0.88
-23.47%
Holley Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q4-2024)
| % Change Since: -6.76%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with significant achievements in operational improvements, digital growth, and margin enhancements. However, these were counterbalanced by sales decline, consumer confidence challenges, and a net loss due to impairment charges. Overall, the company has made substantial progress but continues to face demand and macroeconomic challenges.Q4-2024 Updates
Positive Updates
Digital and Consumer Experience Growth
Direct to consumer business experienced substantial year-over-year growth of 8%, driven by capturing market share through improved consumer experiences and digital capabilities.
Operational Improvements and Cost Reduction
Achieved significant operational improvements including debt reduction, a 22% year-over-year reduction in past dues, and cost savings of $7.8 million in 2024.
B2B and National Retailer Channel Success
Year-over-year growth in 17 brands across all channels, with a 12% growth in the national retailer channel and enhanced support covering 80% of B2B volume.
Margin and EBITDA Improvements
Gross margins improved by 690 basis points year-over-year to 45.6% in Q4, and EBITDA margins increased by 250 basis points to 20.8%.
Expansion into Mexico
Expanded into Mexico through direct to distributor relationships, opening new opportunities in the Mexican market.
Product Innovation and Launches
Launched several key products in Q4, including engine swaps and new safety portfolio offerings, contributing to a 75% increase in new product revenue per SKU.
Free Cash Flow and Debt Reduction
Generated $42 million in free cash flow for 2024 and prepaid $25 million on the term loan, leading to credit upgrades from Moody's and S&P.
Negative Updates
Net Sales Decline
Net sales decreased by 10% to $140.1 million for Q4 compared to the prior year, driven by reseller destocking and macroeconomic headwinds.
Consumer Confidence and Demand Challenges
Cautious outlook due to softened consumer confidence and spending, influenced by high prices of household necessities and policy uncertainties.
Free Cash Flow Reduction
Free cash flow for Q4 was $1.8 million, a significant decrease of $28.1 million compared to the prior year, impacted by lower volume and reduced inventory levels.
Net Loss Due to Impairment Charges
Net loss for Q4 was $37.8 million due to noncash goodwill and trademark impairment charges totaling $48.6 million.
Company Guidance
During the call, Holley provided guidance for the full year 2025, anticipating net sales of $580 million to $600 million, which implies a 2.5% growth at the midpoint from the company's core business base. The adjusted EBITDA for 2025 is projected to be between $113 million and $130 million. The company has factored in several key elements, including a $13 million reduction in revenue due to the divestiture of noncore businesses and a $14 million impact from discontinued products. Holley expects an organic growth rate of 0.8% to 4.3% on the core business. Other financial considerations include a $7 million expense increase related to the reinstatement of certain benefits and SOX-related investments, offset by $8 million to $10 million in operational savings, partially countered by $4 million to $5 million in inflation costs. The guidance reflects cautious optimism in light of current consumer confidence trends and assumes no further deterioration in the macroeconomic environment.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.