MasterCraft Boat Holdings, Inc. (NASDAQ: MCFT)

Sector: Consumer Cyclical Industry: Recreational Vehicles CIK: 0001638290
Market Cap 384.71 Mn
P/B 2.03
P/E 24.66
P/S 1.30
ROIC (Qtr) 6.57
Div Yield % 0.00
Rev 1y % (Qtr) 13.24
Total Debt (Qtr) 0.00
Debt/Equity (Qtr) 0.00
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About

Investment thesis

Bull case

  • Operating cash flow of 35.51M provides exceptional 403.47x coverage of interest expenses 88000, showing strong debt service capability.
  • Operating cash flow of 35.51M provides strong 10.33x coverage of stock compensation 3.44M, indicating sustainable incentive practices.
  • Robust free cash flow of 26.19M exceeds capital expenditure of 9.31M by 2.81x, indicating strong organic growth funding capability.
  • Robust tangible asset base of 200.24M provides 3.15x coverage of working capital 63.57M, indicating strong operational backing.
  • Free cash flow of 26.19M provides exceptional 297.65x coverage of interest expense 88000, showing strong debt service ability.

Bear case

  • Operating cash flow of 35.51M barely covers its investment activities of (5.37M), with a coverage ratio of -6.61, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating earnings of 19.80M show weak coverage of depreciation charges of 9.60M, with a 2.06 ratio indicating high capital intensity and potential reinvestment needs.
  • Operating cash flow of 35.51M is outpaced by equity issuance of (7.61M) (-4.66 ratio), indicating concerning reliance on equity markets for funding operations.
  • Short-term investments of 25.15M exceed receivables of 3.96M by 6.35x, indicating potentially inefficient capital allocation given collection cycle needs.
  • R&D investment of 0 represents just 0x of SG&A expenses of 46.76M, indicating potential underinvestment in innovation relative to administrative overhead.

Peer comparison

Companies in the Recreational Vehicles
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 THO Thor Industries Inc 6.02 Bn 23.47 1.31 0.98 Bn
2 BC Brunswick Corp 5.79 Bn -42.13 1.08 2.25 Bn
3 HOG Harley-Davidson, Inc. 4.54 Bn 6.22 0.77 5.21 Bn
4 LCII Lci Industries 3.86 Bn 29.02 1.80 1.20 Bn
5 PII Polaris Inc. 3.76 Bn -8.07 0.53 1.54 Bn
6 WGO Winnebago Industries Inc 1.38 Bn 106.02 0.46 0.58 Bn
7 MBUU Malibu Boats, Inc. 0.62 Bn 43.18 0.76 0.02 Bn
8 MCFT MasterCraft Boat Holdings, Inc. 0.38 Bn 24.66 1.30 0.00 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.36 0.70
EV to Cash from Ops. EV/CFO 9.94 6.55
EV to Debt EV to Debt 0.00 3.14
EV to EBIT EV/EBIT 17.82 -18.45
EV to EBITDA EV/EBITDA 13.50 10.49
EV to Free Cash Flow [EV/FCF] EV/FCF 13.48 12.72
EV to Market Cap EV to Market Cap 0.92 -21.47
EV to Revenue EV/Rev 1.19 0.65
Price to Book Value [P/B] P/B 2.03 1.89
Price to Earnings [P/E] P/E 24.66 18.23
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.00 0.48
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 17.83
Dividend per Basic Share Div per Share (Qtr) 0.00 0.91
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 20.02
Interest Coverage Int. cover (Qtr) 225.06 11.87
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 9.81 55.44
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 63.87 -6.35
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -1.69
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 673.38 21.79
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 63.65 2.46
EBIT Growth (1y) % EBIT 1y % (Qtr) 1,147.33 80.41
EBT Growth (1y) % EBT 1y % (Qtr) 526.77 119.88
EPS Growth (1y) % EPS 1y % (Qtr) 346.15 23.97
FCF Growth (1y) % FCF 1y % (Qtr) 441.01 548.19
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 27.93 93.02
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.14 0.93
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.15
Cash Ratio Cash Ratio (Qtr) 0.94 0.54
Current Ratio Curr Ratio (Qtr) 2.07 2.54
Debt to Equity Ratio Debt/Equity (Qtr) 0.00 1.02
Interest Cover Ratio Int Coverage (Qtr) 225.06 11.87
Times Interest Earned Times Interest Earned (Qtr) 225.06 11.87
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 9.90 -5.77
EBIT Margin % EBIT Margin % (Qtr) 6.69 -12.97
EBT Margin % EBT Margin % (Qtr) 6.66 -10.90
Gross Margin % Gross Margin % (Qtr) 22.00 21.59
Net Profit Margin % Net Margin % (Qtr) 5.30 -11.85