BLBD Overview

Industry Outlook: The Zacks Domestic Auto industry is poised for growth due to the introduction of affordable electric vehicles (EVs) and proposed tax incentives, which are expected to boost demand despite economic challenges and rising tariffs.

Tax Incentives Impact: The Trump administration's proposed tax deduction of up to $10,000 on interest for U.S.-assembled vehicles could stimulate demand, with 2025 sales projected to reach 16.1-16.2 million units, benefiting domestic automakers like General Motors, Polaris, and Blue Bird.

Competitive Challenges: American automakers are facing increasing competition from Chinese manufacturers, who have significantly expanded their market share in Europe and China, making it harder for U.S. companies to maintain their global positions.

Stock Recommendations: General Motors, Polaris, and Blue Bird are highlighted as strong investment options, with positive earnings outlooks and recent performance exceeding expectations, indicating potential for continued growth in the domestic auto market.

Stock Performance: Blue Bird (BLBD) closed at $51.48, up 1.12%, outperforming the S&P 500's 0.21% gain, but has seen a 1.36% decline over the past month compared to the Auto-Tires-Trucks sector's 2.04% gain.

Earnings Forecast: The upcoming earnings report is expected to show an EPS of $0.8, a 13.04% decline year-over-year, with projected revenue of $350 million, reflecting an 11.51% increase from the previous year.

Analyst Estimates and Zacks Rank: Recent analyst estimate revisions have increased the consensus EPS projection by 1.76%, with Blue Bird holding a Zacks Rank of #2 (Buy), indicating positive sentiment among analysts.

Valuation Metrics: Blue Bird's Forward P/E ratio is 12.09, lower than the industry average of 16.56, and its PEG ratio stands at 2.33, compared to the Automotive - Domestic industry's average of 1.89, suggesting potential undervaluation.