Shares of water-sports companies were sinking Monday following a slate of bearish analyst notes that questioned demand metrics for the industry.
Analysts at JPMorgan, SunTrust and Raymond James all expressed trepidation Monday, leading MarineMax (HZO) to drop nearly 14%, Mastercraft Boat Holdings (MCFT) to fall 9.2% and Malibu Boats (MBUU) to decline 7.2%.
"The reason for more cautious view on the space is fairly straightforward -- namely the persistent softness in demand for new power boats within the U.S. market," Raymond James analyst Joseph Altobello wrote. "This was punctuated by the double-digit decline in registrations in June which was reported on Friday, with registrations down [about] 14% for the month and [about] 6% year to date."
Meanwhile, JPMorgan lowered its rating on Brunswick Corp. (BC) to neutral from overweight while lowering its price target to $46 from $61 after its own industry checks showed that the aluminum fish boats and outboard engines segments, where Brunswick is heavily exposed, were especially weak. Brunswick fell 4.74% to $43.56 in trading Monday.