On Monday, DA Davidson adjusted its outlook on BRP Inc . (NASDAQ: NASDAQ:DOOO), reducing the price target to $104 from the previous $105 while sustaining a Buy rating on the shares. The change follows BRP's announcement that, despite surpassing earnings expectations for the first quarter of 2025, they had to revise their initial fiscal year 2025 earnings guidance downward.
The company's decision to cut its FY25 earnings forecast is seen as a cautious move in response to the current state of industry inventory. Analysts noted that while this revision is a setback, BRP's robust off-road vehicle (ORV) retail performance, which showed gains in every product segment, is a positive sign.
The firm's confidence in BRP's prospects is reflected in the maintained Buy rating, despite the slight decrease in the price target. The new target is based on a price-to-earnings (P/E) multiple of 13.0 times the firm's forecasted fiscal year 2026 earnings per share (EPS) of $8.00.
BRP's adjustment in earnings guidance and the subsequent price target modification by DA Davidson highlight the company's strategic response to market conditions. The firm's anticipation of BRP's continued performance in the ORV market underpins its investment rating decision.
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