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BC

Brunswick looks pretty expensive.

Bc lost $6.63 per share last year, leaving tangible book value per share negative - ($1.79). Consensus for 2010 is a loss of $2.41 - bringing TBV/Share to ($4.20).

Revenue estimates are $3.4 billion (up 20%) for 2010 and $3.8 billion (up 12%) for 2011. Consensus earnings for 2011 are $0.00. BC made $1.24 per share on 2007 on revenues of $5.7 billion. They would need to grow revenues 50% in 2012 to reach 07 levels. Before the credit boom they averaged a 3.5% net margin, so theoretically they could make $1.50 per share $4 billion in revenues. That assumes that they don't have to issue equity to repair their ridiculous balance sheet. Then there is the question of how sales are going to grow 20% this year and 12% next year with dated inventory at the dealers,  and taxes and interest rates going up.




Disclosure: Short BC, long out-of-the-money puts