Stifel analyst Martin Landry found “resilience” within the Powersports industry, suggesting BRP Inc. is poised to benefit. “Our survey results within the powersports industry continue to impress with 22 per cent of Canadians likely or highly likely to purchase or upgrade a powersport vehicle over the next 12 months, which is mostly unchanged vs our last two surveys,” he said. “This suggests continued resilience within the industry and is aligned with recent scanner data from CDK Global Data made exclusively available by Powersports Business. According to CDK’s scanner data, retail sales volumes for powersports vehicles at U.S dealerships are sustained in May 2022 and up 40 per cent vs pre-pandemic levels. These results strengthen our thesis that BRP’s TTM [trailing 12-month] earnings, despite being extremely strong, are sustainable in the near-term.”
He kept a “buy” rating and $145 target for BRP shares, above the $131.88 consensus.
Mr. Landry also found encouraging brand awareness for Guru Organic Energy Corp. (“buy” and $11 target), Pet Value Holdings Ltd. (, “buy” and $42) and Spin Master Corp. (“buy” and $64).
“According to our survey, aided brand awareness for GURU increased by 200bps outside of Quebec compared to our Q4/21 survey, suggesting that the company’s early marketing efforts in the rest of Canada are starting to get traction,” he said. “GURU continues to over-index with younger demographics and with females, both appealing groups. With regard to Pet Valu, the company’s newly acquired Chico network shows good brand awareness in Quebec at 24 per cent, despite being a relatively new chain. Finally, brand awareness for three of Spin Master’s licensed properties is strong with Paw Patrol at 70 per cent, Monster Jam at 42 per cent and Kinetic Sands at 40 per cent.”