HomeMost PopularInvestingBear of the Day: OneWater Marine (ONEW)

Bear of the Day: OneWater Marine (ONEW)

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OneWater Marine (ticker: ONEW), a leading boat retailer, is experiencing a significant downturn due to negative guidance from management, declining earnings estimates, and shrinking margins. As a result, analysts have downgraded the company, giving it a Zacks Rank #5 (Strong Sell).

Falling Earnings Estimates

Earnings estimates for OneWater Marine have fallen significantly in the past two months. Current quarter estimates have been reduced by 73% and are projected to decline 66% YoY to $0.43 per share. FY23 earnings estimates have been revised down by 37% and are expected to drop by 50% YoY to $4.58 per share.

While OneWater Marine may have a slightly positive sales growth outlook for this year and the next, the overall boating industry is facing challenges ahead.

Zacks Investment Research
Image Source: Zacks Investment Research

Bearish Technical Pattern

After plummeting more than 30% following a disappointing Q3 earnings report, OneWater Marine’s stock has remained under pressure. The price action indicates a bearish wedge formation in the chart, and a recent breakdown suggests further downside ahead.

TradingView
Image Source: TradingView

Valuation

OneWater Marine is currently trading at a forward earnings multiple of 5.4x, which is in line with its historical median and well below the industry average of 24.8x.

Zacks Investment Research
Image Source: Zacks Investment Research

Bottom Line

The leisure and recreation industry, including the boating sector, is currently facing significant challenges. While there may be a future rebound in demand for OneWater Marine’s products, it is advised to avoid the stock until earnings estimates start trending upwards.

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OneWater Marine Inc. (ONEW): Free Stock Analysis Report

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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.

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