BRP's 'Double Down' On Powersports As Textron Shutters Production Is A Referendum Worth Watching

Jeffrey Fischer, CFA
1.41K Followers
(9min)

Summary

  • BRP Inc. shareholders are mired in losses, while BRP management is mired in lost credibility.
  • Textron is shutting down Arctic Cat production of powersports vehicles, while BRP is increasing its focus in that area. Somebody's probably wrong.
  • Potential U.S. tariffs against Canadian products adds to the uncertainty.
  • There are just too many unknowns to make an investment in BRP, but I'll be watching intently from the sidelines.

Backcountry snowmobiling

AscentXmedia/E+ via Getty Images

(all financial numbers are presented in Canadian Dollars, unless otherwise specified)

The recreational vehicle (RV) space has struggled mightily in recent times, bringing with it pain for companies like Polaris (PII), BRP Inc. (

This article was written by

1.41K Followers
25 years+ in the financial/investment industry (see LinkedIn for more details). Currently self employed with my own investor service that supports top notch Seeking Alpha analysts. Former Senior Managing Editor here at Seeking Alpha; the tail end of an ~11 year stint working for SA. Prior to this, I worked as a Treasury Manager for a large commodities firm, where I managed financial liquidity, currency risk hedge portfolios, and investment arbitrage trades. I've also worked in financial performance analytics, trading, and banking. I have a healthy interest in behavioral finance and love a good investment "story" at least as much as a financial analysis. My investment ideas on SA will likely be a mix of contrarian, event-driven, and structured trades. I completed the requirements of the CFA Charter in 2003, and am an active member of the CFA Institute. MY PERSONAL FAVS:https://seekingalpha.com/article/4688259-qyld-and-contango-capture-for-possible-15-percent-yieldhttps://seekingalpha.com/article/4690866-tripadvisor-plummet-on-m-and-a-rejection-brings-stock-back-into-playhttps://seekingalpha.com/article/4707286-eventbrites-net-cash-is-an-illusion-sell

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