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BRP Inc (TSE:DOO)
TSX:DOO
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BRP
(TSX:DOO)
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Rating:54Neutral
Price Target:
C$92.00
▼(-1.36% Downside)
BRP's overall stock score is driven by strong technical indicators and revenue growth, but is significantly hampered by poor profitability and high leverage. The technical analysis shows bullish momentum, which is a positive sign for short-term investors. However, the negative P/E ratio and high debt levels present substantial risks. Investors should be cautious of the overbought technical indicators, which could lead to a correction.
Positive Factors
Negative Factors
BRP (DOO) vs. iShares MSCI Canada ETF (EWC)
Market Cap
$6.53B
Dividend Yield0.92%
Average Volume (3M)243.98K
Price to Earnings (P/E)19.7
Beta (1Y)0.89
Revenue Growth-13.78%
EPS Growth-115.58%
CountryCA
Employees16,500
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Recreational Vehicles
Share Statistics
EPS (TTM)0.92
Shares Outstanding34,512,676
10 Day Avg. Volume220,307
30 Day Avg. Volume243,981
Financial Highlights & Ratios
PEG Ratio0.18
Price to Book (P/B)21.22
Price to Sales (P/S)0.65
P/FCF Ratio16.32
Enterprise Value/Market Cap1.21
Enterprise Value/Revenue1.02
Enterprise Value/Gross Profit4.82
Enterprise Value/Ebitda9.41
Forecast
1Y Price Target
$101.33Price Target Upside8.65% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering13
BRP Business Overview & Revenue Model
Company DescriptionBRP Inc., together with its subsidiaries, designs, develops, manufactures, distributes, and markets powersports vehicles and marine products in the United States, Canada, Europe, the Asia Pacific, Mexico, Austria, and internationally. The company operates through two segments, Powersports and Marine. It offers all-terrain, side-by-side, and three-wheeled vehicles; seasonal products, such as snowmobiles and personal watercraft; and engines for jet boats, outboards, karts, motorcycles, and recreational aircraft. The company also provides parts, accessories, and apparel, as well as other services. It sells its products through a network of independent dealers and distributors, as well as to original equipment manufacturers. The company was formerly known as J.A. Bombardier (J.A.B.) Inc. and changed its name to BRP Inc. in April 2013. BRP Inc. was founded in 1937 and is headquartered in Valcourt, Canada.
How the Company Makes MoneyBRP generates revenue through the sale of its recreational vehicles and parts, accessories, and clothing. The company primarily earns money from the direct sale of its products to consumers and dealerships, with significant revenue streams coming from its seasonal products like snowmobiles and personal watercraft. Additionally, BRP benefits from recurring revenue through the sale of aftermarket parts and accessories, which are essential for the maintenance and customization of its vehicles. The company also engages in strategic partnerships and collaborations with various dealers and retailers to enhance distribution and reach a wider customer base. Seasonal demand, brand loyalty, and a strong focus on innovation further contribute to BRP's financial performance.
BRP Earnings Call Summary
Earnings Call Date:Aug 29, 2025
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 26, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a balanced view of BRP's performance, with strong financial results, market share gains, and successful product launches being offset by challenges in certain markets and the impact of tariffs on margins.Q2-2026 Updates
Positive Updates
Record Revenue and Strong Free Cash Flow
BRP ended the quarter with revenue of $1.9 billion and solid free cash flow of almost $100 million.
Market Share Gains in Canada and Latin America
Canada's retail grew by 4%, driven by ORV, while Latin America retail was up 22%, led by ORV performance.
Successful Launch of New Products
The launch of the new generation of the Can-Am Defender and other product enhancements received positive feedback.
Electric Vehicle Expansion
Introduction of the Outlander electric with industry-leading towing capacity and quiet riding experience.
Improved Dealer Inventory Levels
Dealer inventory ended the quarter down 20% year-over-year, with a leaner inventory position across most product lines.
Positive EBITDA and EPS Guidance
Guidance calls for revenues of $8.15 billion to $8.3 billion, normalized EBITDA of $1.04 billion to $1.09 billion, and normalized EPS of $4.25 to $4.75.
Negative Updates
Decline in North American Powersport Retail
Overall North American Powersport retail decreased by 11%, with a 15% decline in the U.S.
Challenges in EMEA Market
Retail in EMEA was down 13%, in line with the industry trends.
Tariff Impacts on Margins
Gross profit margin was down year-over-year due to lower capacity utilization, unfavorable product mix, and a $90 million gross tariff impact.
Mid-20% Decline in 3-Wheel Vehicle Retail
3-wheel vehicle retail was down mid-20% due to entry-level consumers struggling with financing approvals.
Continued Soft Trends in Personal Watercraft and Switch Pontoon
Retail for personal watercraft and Switch pontoon was down mid-teen percent and mid-20%, respectively.
Company Guidance
During the BRP Inc.'s FY26 Second Quarter Results Conference Call, guidance for the second half of the fiscal year was provided. BRP projected revenues between $8.15 billion and $8.3 billion, with a normalized EBITDA ranging from $1.04 billion to $1.09 billion, and normalized EPS between $4.25 and $4.75. The company anticipates second-half revenue growth of 8% to 12%, driven by new product introductions and operational efficiencies. Notably, they expect a significant improvement in profitability, with H2 normalized EBITDA anticipated to rise by 22% to 31%, resulting in an EBITDA margin exceeding 14%. This optimism stems from the successful rightsizing of network inventory, particularly as dealer inventory levels decreased by 20% year-over-year, aligning more closely with pre-COVID levels. Additionally, BRP's strategic focus on launching innovative products like the new generation of the Can-Am Defender, coupled with a better alignment of wholesale and retail shipments, is expected to strengthen their market position in the second half of the year.BRP Financial Statement Overview
Summary
BRP's financial performance shows strong revenue growth but is hindered by profitability challenges and high leverage. The income statement reveals a significant revenue growth rate of 59.8%, yet the company struggles with a negative net profit margin of -0.48%. The balance sheet indicates high financial risk with a debt-to-equity ratio of 6.25 and negative return on equity. Cash flow is improving, with a 32.57% growth in free cash flow, but there is room for better conversion of earnings to cash.Income Statement
BRP's income statement shows a mixed performance. The TTM data indicates a significant revenue growth rate of 59.8%, but the company is struggling with profitability, as evidenced by a negative net profit margin of -0.48%. The gross profit margin is relatively low at 21.21%, and the EBIT margin is modest at 5.41%. The company needs to improve its cost management to enhance profitability.45
Neutral
Balance Sheet
The balance sheet reveals high leverage, with a debt-to-equity ratio of 6.25 in the TTM period, indicating significant financial risk. The return on equity is negative at -8.74%, reflecting the company's challenges in generating returns for shareholders. The equity ratio is low, suggesting a reliance on debt financing.40
Negative
Cash Flow
BRP's cash flow statement shows some positive trends, with a 32.57% growth in free cash flow in the TTM period. The operating cash flow to net income ratio is 0.38, indicating decent cash generation relative to net income. However, the free cash flow to net income ratio is 0.56, suggesting room for improvement in converting earnings to cash.55
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 7.75B | 7.83B | 9.96B | 10.03B | 7.65B | 5.95B |
| Gross Profit | 1.65B | 1.77B | 2.63B | 2.50B | 2.13B | 1.55B |
| EBITDA | 843.10M | 976.60M | 1.74B | 1.61B | 1.39B | 943.40M |
| Net Income | -37.60M | -213.10M | 743.40M | 863.90M | 793.90M | 363.40M |
Balance Sheet | ||||||
| Total Assets | 6.29B | 6.29B | 6.78B | 6.46B | 5.03B | 4.89B |
| Cash, Cash Equivalents and Short-Term Investments | 271.60M | 180.70M | 491.80M | 202.30M | 265.80M | 1.33B |
| Total Debt | 3.04B | 3.13B | 2.95B | 3.02B | 2.19B | 2.65B |
| Total Liabilities | 5.80B | 6.05B | 5.96B | 5.92B | 5.16B | 5.36B |
| Stockholders Equity | 485.60M | 241.30M | 808.90M | 534.90M | -135.60M | -478.70M |
Cash Flow | ||||||
| Free Cash Flow | 338.20M | 165.70M | 942.10M | -52.20M | 87.90M | 608.80M |
| Operating Cash Flow | 685.00M | 562.30M | 1.49B | 548.80M | 716.80M | 862.10M |
| Investing Cash Flow | -363.90M | -425.50M | -574.90M | -853.40M | -687.70M | -260.30M |
| Financing Cash Flow | -173.10M | -375.30M | -629.20M | 291.00M | -1.09B | 675.90M |
BRP Technical Analysis
Positive
93.27
Price Trends
80.77
Positive
71.44
Positive
65.53
Positive
Market Momentum
1.66
Positive
68.41
Neutral
72.92
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:DOO, the sentiment is Positive. The current price of 93.27 is above the 20-day moving average (MA) of 87.56, above the 50-day MA of 80.77, and above the 200-day MA of 65.53, indicating a bullish trend. The MACD of 1.66 indicates Positive momentum. The RSI at 68.41 is Neutral, neither overbought nor oversold. The STOCH value of 72.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:DOO.
BRP Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | C$18.64B | 11.22 | 8.76% | 4.01% | -0.54% | 26.31% | |
74 Outperform | C$4.41B | 20.99 | 3.62% | 1.42% | -2.60% | -64.22% | |
64 Neutral | C$260.97M | 10.98 | 6.01% | 6.14% | -3.50% | -22.76% | |
62 Neutral | C$778.83M | -12.34 | -4.32% | 1.87% | -8.84% | -148.15% | |
54 Neutral | $6.53B | 19.66 | 38.70% | 0.92% | -13.78% | -115.58% | |
45 Neutral | C$1.86B | -8.08 | -29.35% | ― | 9.12% | -182.49% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% |
* Consumer Cyclical Sector Average
TSE:DOO
BRP
93.27
13.91
17.53%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.