Is Now The Time To Look At Buying Malibu Boats, Inc. (NASDAQ:MBUU)?

Malibu Boats, Inc. (NASDAQ:MBUU), is not the largest company out there, but it received a lot of attention from a substantial price increase on the NASDAQGM over the last few months. As a stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, could the stock still be trading at a relatively cheap price? Let’s examine Malibu Boats’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

See our latest analysis for Malibu Boats

What is Malibu Boats worth?

Great news for investors – Malibu Boats is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is $113.78, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that Malibu Boats’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.

What kind of growth will Malibu Boats generate?

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. With profit expected to grow by 92% over the next couple of years, the future seems bright for Malibu Boats. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What this means for you:

Are you a shareholder? Since MBUU is currently undervalued, it may be a great time to increase your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on MBUU for a while, now might be the time to make a leap. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy MBUU. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed investment decision.

If you want to dive deeper into Malibu Boats, you'd also look into what risks it is currently facing. For example - Malibu Boats has 2 warning signs we think you should be aware of.

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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.
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