When the coronavirus took hold last year, restrictions were put in place, compelling Americans to cancel travel plans and other forms of outdoor entertainment. When some of those restrictions began to gradually ease, people started engaging in certain outdoor recreational activities. This is when people chose boating because it allowed them to maintain social distancing while spending quality time with their families. Owing to this trend, boat sales in the United States skyrocketed in 2020.
Per the National Marine Manufacturers Association (“NMMA”), retail unit sales of new powerboats in the United States reached a 13-year high in 2020, rising 13% with nearly 320,000 units sold, as mentioned in a
Business Wire article. The article also stated, citing the NMMA, that annual sales of boats, marine products, and services in the United States increased 14% in 2020. What drove the boating industry’s growth in 2020 was the increasing demand among first-time buyers. New data from NMMA showed that 415,000 first-time buyers entered the market last year, as mentioned in the same article.
Recreational boats are seeing robust demand this year too even as the economy is gradually opening up. In fact, NMMA president Frank Hugelmeyer stated, as mentioned in the Business Wire article, that people are “continuing to choose boating as the preferred choice in recreation.” Hugelmeyer added that demand for boating and boat sales is set to remain strong as “more people discover the mental health benefits, joys and freedoms of being outside and on the water.”
Through March 2021, new boat sales were up 30% from the 2020 average, stated the article, citing the NMMA. Through May 2021, traffic to the website of Discover Boating, which acts as the resource hub for those keen on boating, was up 56% year over year.
Younger Americans are becoming more interested in boating as the article mentioned that the Discover Boating website witnessed 90% year-over-year growth in the 18 to 24 age segment through May 2021. Adding to this positive sentiment, a
report by Mordor Intelligence suggested that the recreational boating market is estimated to reach $35 billion by 2026 at a CAGR of around 5%, with North America expected to be the fastest-growing market. 3 Stocks to Keep a Close Eye On
Demand for boating looks set to continue as Americans resort to recreational activity as they try to go past the pandemic. Hence, this seems like an ideal time to take a look at companies with strong fundamentals that stand to benefit from this potential. Notably, we have selected three stocks that carry a Zacks Rank #2 (Buy) or 3 (Hold). You can see
. the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here Brunswick Corporation’s ( BC Quick Quote BC - Free Report) Propulsion segment provides outboard, sterndrive and inboard engines for independent boat builders and governments. The company’s Boat segment provides Sea Ray sport boats and cruisers, Bayliner sport cruisers and runabouts, Boston Whaler fiberglass offshore boats, and so on. It currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings increased 1.7% over the past 60 days. The company’s expected earnings growth rate for the current year is 49.9%. MasterCraft Boat Holdings, Inc. ( MCFT Quick Quote MCFT - Free Report) , through its subsidiaries, designs, manufactures and markets recreational powerboats. The company currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings increased 18.6% over the past 60 days. The company’s expected earnings growth rate for the current year is more than 100%. OneWater Marine Inc. ( ONEW Quick Quote ONEW - Free Report) operates as a recreational boat retailer in the United States and offers new and pre-owned recreational boats and yachts, as well as related marine products, such as parts and accessories. The company currently has a Zacks Rank #3. The Zacks Consensus Estimate for its current-year earnings increased 8.1% over the past 60 days. The company’s expected earnings growth rate for the current year is 67.4%. 5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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