Introducing Malibu Boats (NASDAQ:MBUU), The Stock That Soared 463% In The Last Five Years

By
Simply Wall St
Published
January 28, 2021
NasdaqGM:MBUU

Buying shares in the best businesses can build meaningful wealth for you and your family. While not every stock performs well, when investors win, they can win big. Just think about the savvy investors who held Malibu Boats, Inc. (NASDAQ:MBUU) shares for the last five years, while they gained 463%. If that doesn't get you thinking about long term investing, we don't know what will. On top of that, the share price is up 37% in about a quarter. But this move may well have been assisted by the reasonably buoyant market (up 16% in 90 days).

Check out our latest analysis for Malibu Boats

In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

Over half a decade, Malibu Boats managed to grow its earnings per share at 26% a year. This EPS growth is slower than the share price growth of 41% per year, over the same period. This suggests that market participants hold the company in higher regard, these days. And that's hardly shocking given the track record of growth.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

earnings-per-share-growth
NasdaqGM:MBUU Earnings Per Share Growth January 28th 2021

We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. It might be well worthwhile taking a look at our free report on Malibu Boats' earnings, revenue and cash flow.

A Different Perspective

We're pleased to report that Malibu Boats shareholders have received a total shareholder return of 61% over one year. That gain is better than the annual TSR over five years, which is 41%. Therefore it seems like sentiment around the company has been positive lately. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. It's always interesting to track share price performance over the longer term. But to understand Malibu Boats better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Malibu Boats you should know about.

Malibu Boats is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020


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