MarineMax, Inc. HZO reported first-quarter fiscal 2025 results, wherein the top line lagged the Zacks Consensus Estimate but the bottom line surpassed the same. Both revenues and earnings decreased from the year-ago quarter. 

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Quarterly revenues and same-store sales were impacted by a soft retail environment and disruptions from Hurricanes Helene and Milton, leading to lower revenues and higher inventory than expected.

However, the company’s margin profile strengthened through acquisitions and organic growth, enhancing its resilience. Moreover, expense-reduction initiatives, including the closure or divestiture of three locations, remain key to maintaining profitability and strengthening operations in fiscal 2025. HZO shares have gained 14.2% in the past month compared with the industry’s 3.3% growth.

More on MarineMax’s Q1 Results

HZO reported adjusted earnings of 17 cents per share, beating the Zacks Consensus Estimate of an adjusted loss of 26 cents. However, the bottom line decreased from adjusted earnings of 19 cents in the year-ago period.

Net sales of $468.5 million missed the consensus estimate of $484 million. Also, the top line dipped 11.2% from the year-ago quarter. This decrease was primarily led by reduced boat sales and disruptions caused by Hurricanes Helene and Milton. Consequently, comparable sales (comps) fell 11% year over year.

Net sales of retail operations and product manufacturing declined 10.6% and 17.8% year over year to $468.4 million and $37.9 million, respectively. The Zacks Consensus Estimate for net sales for the retail operations and product manufacturing segments was pegged at $494 million and $30.6 million, respectively, in the fiscal first quarter.

HZO Stock Past-Month Performance

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Insight Into HZO’s Margins & Expenses

Gross profit declined 3.3% in the first quarter to $169.7 million from $175.5 million in the prior-year period. Despite the decrease in consolidated sales, the gross margin rose 290 basis points year over year to 36.2%. This improvement was driven by the current promotional environment, changes in the sales mix, and increased contributions from the company's higher-margin businesses.

Adjusted selling, general and administrative (SG&A) expenses declined 1.5% to $149.4 million from $151.7 million in the same period of fiscal 2024. As a percentage of net sales, adjusted SG&A expenses increased 310 basis points year over year to 31.9%.

This Zacks Rank #3 (Hold) company reported an adjusted EBITDA of $26.1 million, down 2.2% from an adjusted EBITDA of $26.6 million in the year-ago quarter. We note that the adjusted EBITDA margin was 5.6%, up 50 basis points year over year.

MarineMax’s Financial Snapshot

HZO ended the fiscal first quarter with cash and cash equivalents of $145 million, long-term debt (net of current maturities) of $347.3 million, and shareholders' equity of $1 billion. Inventories rose 18.1% on a year-over-year basis to $1.04 billion.

Peek Into MarineMax’s FY25 Guidance

The company reaffirmed its fiscal 2025 guidance, considering the impacts of Hurricanes Helene and Milton, current business conditions, retail trends and other relevant factors. It continues to expect fiscal 2025 adjusted earnings per share between $1.80 and $2.80, and adjusted EBITDA between $150 million and $180 million. Despite challenging economic conditions in the recreational marine industry, activities are expected to increase as the spring selling season approaches.

Stocks to Consider

Some better-ranked stocks are Abercrombie & Fitch Co. ANF, The Gap, Inc. GAP and Deckers Outdoor Corporation DECK.

Abercrombie is a specialty retailer of premium, high-quality casual apparel. It sports a Zacks Rank of 1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Abercrombie’s fiscal 2025 earnings and sales indicates growth of 69.4% and 15.1%, respectively, from the fiscal 2024 reported levels. ANF has a trailing four-quarter average earnings surprise of 14.8%.

Gap is a premier international specialty retailer offering a diverse range of clothing, accessories and personal care products. It presently has a Zacks Rank #2 (Buy). 

The Zacks Consensus Estimate for Gap’s fiscal 2025 earnings and sales indicates growth of 41.3% and 0.8%, respectively, from fiscal 2024 reported figures. GAP has a trailing four-quarter average earnings surprise of 101.2%.

Deckers is a leading designer, producer and brand manager of innovative, niche footwear and accessories. It carries a Zacks Rank of 2 at present.

The Zacks Consensus Estimate for DECK’s fiscal 2024 earnings and sales suggests growth of 14.4% and 14.1%, respectively, from the year-ago actuals. DECK delivered a trailing four-quarter average earnings surprise of 41.1%.

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