Let’s dig into the relative performance of Solo Brands (NYSE: DTC) and its peers as we unravel the now-completed Q4 leisure products earnings season.
Leisure products cover a wide range of goods in the consumer discretionary sector. Maintaining a strong brand is key to success, and those who differentiate themselves will enjoy customer loyalty and pricing power while those who don’t may find themselves in precarious positions due to the non-essential nature of their offerings.
The 13 leisure products stocks we track reported a mixed Q4. As a group, revenues beat analysts’ consensus estimates by 1.6% while next quarter’s revenue guidance was 1.7% below.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 24.3% since the latest earnings results.
Solo Brands (NYSE: DTC)
Started through a Kickstarter campaign, Solo Brands (NYSE: DTC) is a provider of outdoor and recreational products.
Solo Brands reported revenues of $143.5 million, down 13.2% year on year. This print fell short of analysts’ expectations by 10%. Overall, it was a disappointing quarter for the company with a miss of analysts’ Wholesale revenue estimates and a significant miss of analysts’ EBITDA estimates.
Solo Brands delivered the weakest performance against analyst estimates of the whole group. Unsurprisingly, the stock is down 79.5% since reporting and currently trades at $0.13.
Read our full report on Solo Brands here, it’s free.
Best Q4: Malibu Boats (NASDAQ: MBUU)
Founded in California in 1982, Malibu Boats (NASDAQ: MBUU) is a manufacturer of high-performance sports boats and luxury watercrafts.
Malibu Boats reported revenues of $200.3 million, down 5.1% year on year, outperforming analysts’ expectations by 4.8%. The business had an exceptional quarter with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ adjusted operating income estimates.
The stock is down 29.7% since reporting. It currently trades at $27.01.
Is now the time to buy Malibu Boats? Access our full analysis of the earnings results here, it’s free.
Weakest Q4: Harley-Davidson (NYSE: HOG)
Founded in 1903, Harley-Davidson (NYSE: HOG) is an American motorcycle manufacturer known for its heavyweight motorcycles designed for cruising on highways.
Harley-Davidson reported revenues of $687.6 million, down 34.7% year on year, falling short of analysts’ expectations by 3.8%. It was a disappointing quarter as it posted a miss of analysts’ motorcycles sold estimates and a significant miss of analysts’ adjusted operating income estimates.
Harley-Davidson delivered the slowest revenue growth in the group. As expected, the stock is down 14.6% since the results and currently trades at $22.91.
Read our full analysis of Harley-Davidson’s results here.
Smith & Wesson (NASDAQ: SWBI)
With a history dating back to 1852, Smith & Wesson (NASDAQ: SWBI) is a firearms manufacturer known for its handguns and rifles.
Smith & Wesson reported revenues of $115.9 million, down 15.7% year on year. This result came in 3% below analysts' expectations. All in all, it was a slower quarter for the company.
The stock is down 15% since reporting and currently trades at $9.38.
Read our full, actionable report on Smith & Wesson here, it’s free.
Polaris (NYSE: PII)
Founded in 1954, Polaris (NYSE: PII) designs and manufactures high-performance off-road vehicles, snowmobiles, and motorcycles.
Polaris reported revenues of $1.78 billion, down 22.9% year on year. This number beat analysts’ expectations by 5.9%. Overall, it was a strong quarter as it also logged a decent beat of analysts’ EPS estimates.
The stock is down 41.2% since reporting and currently trades at $33.22.
Read our full, actionable report on Polaris here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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