Financial Performance Highlights - Blue Bird's Q3 FY2025 net sales reached $398 million, a $65 million increase compared to Q3 FY2024[20, 25] - The company's Adjusted EBITDA for Q3 FY2025 was $58 million, up $10 million from Q3 FY2024[20, 25] - Adjusted Free Cash Flow for Q3 FY2025 was $52 million, a $56 million increase compared to Q3 FY2024[20, 25] - Blue Bird is raising its full-year FY2025 Adjusted EBITDA guidance to $210 million and expects ~14.5% margin[36, 37] - The company's Q3 Adjusted EBITDA margin was 14.7%, a 20 bps increase compared to Q3 FY2024[21, 27] Business Operations and Backlog - The company sold 2,467 units in Q3 FY2025, an increase of 316 units compared to Q3 FY2024[20, 25] - Blue Bird has a strong backlog of approximately 3,900 units, valued at around $618 million[20, 27] - The company has approximately $174 million in firm orders for electric vehicles (EVs) in its backlog[20] - Alternative power sales accounted for 61% of the sales mix[20] Future Outlook and Capital Allocation - Blue Bird anticipates approximately $1.5 billion in revenue for FY2026, with an Adjusted EBITDA of around $220 million, representing a margin of approximately 14.5%[39] - The company has initiated a new share repurchase program of up to $100 million over two years[32, 34, 52]

Group 1 - Blue Bird Corporation (NASDAQ: BLBD) is currently facing short-term supply chain challenges but is managing them effectively with a strong backlog of 4,900 units, revenue growth, and margin expansion [1] - The company operates primarily in a mature market, which may limit growth potential compared to emerging markets [1] - There is a belief that the market is overly focused on short-term issues, leading to mispricing of fundamentally strong companies, which presents potential long-term investment opportunities [1]

Financial Performance and Guidance - Blue Bird confirms FY25 revenue guidance of $1425 million to $1475 million[45] - The company anticipates an adjusted EBITDA of approximately $200 million with a margin of ~14% for FY25[45, 47] - Q2 FY25 adjusted EBITDA reached $49 million with a 14% margin, marking a $3 million increase compared to Q2 FY24[66, 67, 69] - Adjusted free cash flow for Q2 FY25 was $19 million[66, 69] Industry and Market Position - The school bus industry is expected to reach approximately 31,000 units in FY25[22] - Over 47% of school buses in service are 10 years or older, supporting replacement demand[24] - Blue Bird holds a leading market position in alternative power and electric school buses, with over 60% of sales being non-diesel[31, 34] Strategic Initiatives - Blue Bird is expanding its total addressable market (TAM) through the introduction of an EV commercial chassis offering[15, 40] - The company is focused on reducing structural costs through Lean Transformation initiatives[15] - Blue Bird was awarded an $80 million grant by the DOE for a new plant to support profitable growth plans for 12,000+ units[50, 52]

Company Performance - Blue Bird (BLBD) closed at $44.20, reflecting a +2.41% increase from the previous day, outperforming the S&P 500's loss of 0.11% [1] - Over the past month, shares of Blue Bird gained 13.71%, significantly surpassing the Auto-Tires-Trucks sector's decline of 5.6% and the S&P 500's increase of 5.17% [1] Upcoming Earnings - Blue Bird is expected to report an EPS of $0.9, which represents a 1.1% decrease compared to the same quarter last year [2] - The Zacks Consensus Estimate projects net sales of $375 million, indicating a 12.49% increase from the previous year [2] Annual Estimates - For the annual period, the Zacks Consensus Estimates predict earnings of $3.74 per share and revenue of $1.42 billion, reflecting increases of +8.09% and +5.61% respectively from the last year [3] Analyst Estimates - Recent changes to analyst estimates for Blue Bird are crucial as they reflect short-term business trends [4] - Upward revisions in estimates indicate analysts' positive outlook on the company's operations and profit generation capabilities [4] Zacks Rank and Valuation - Blue Bird currently holds a Zacks Rank of 5 (Strong Sell), with the Zacks Consensus EPS estimate remaining unchanged over the last 30 days [6] - The company is trading at a Forward P/E ratio of 11.53, which aligns with its industry's Forward P/E of 11.53, and has a PEG ratio of 0.97 compared to the industry average of 1.15 [7] Industry Context - The Automotive - Domestic industry, part of the Auto-Tires-Trucks sector, has a Zacks Industry Rank of 213, placing it in the bottom 14% of over 250 industries [8] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [8]

Company Performance - Blue Bird (BLBD) closed at $42.88, reflecting a +2.17% increase from the previous day, outperforming the S&P 500 which gained 0.96% [1] - Over the past month, Blue Bird's shares have risen by 8.65%, while the Auto-Tires-Trucks sector has declined by 6.24% [1] Upcoming Financial Results - Analysts expect Blue Bird to report earnings of $0.9 per share, indicating a year-over-year decline of 1.1% [2] - Revenue is anticipated to be $375 million, representing a 12.49% increase from the same quarter last year [2] Full Year Projections - For the full year, earnings are projected at $3.74 per share, with revenue expected to reach $1.42 billion, reflecting changes of +8.09% and +5.61% respectively from the previous year [3] - Recent analyst estimate revisions suggest a positive outlook for the business [3][4] Valuation Metrics - Blue Bird has a Forward P/E ratio of 11.21, which is in line with its industry's Forward P/E [5] - The company has a PEG ratio of 0.95, compared to the Automotive - Domestic industry's average PEG ratio of 1.12 [6] Industry Context - The Automotive - Domestic industry is part of the Auto-Tires-Trucks sector, which has a Zacks Industry Rank of 188, placing it in the bottom 24% of over 250 industries [7] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [7]

Group 1 - The article emphasizes the importance of strong foundational companies in the technology, industrial, and conglomerate sectors for long-term success [1] - It highlights the dual approach of analyzing financial data while narrating the stories and strategies of businesses to provide insights into market performance [1] - The focus on both quantitative analysis and qualitative storytelling reflects a commitment to understanding and explaining the financial landscape [1]

Company Performance - Blue Bird (BLBD) closed at $40.80, down 1.14% from the previous trading session, underperforming the S&P 500's loss of 1.13% [1] - Over the past month, shares of Blue Bird gained 2.25%, while the Auto-Tires-Trucks sector lost 1.16% and the S&P 500 gained 3.55% [1] Upcoming Earnings - Blue Bird is expected to report an EPS of $0.9, reflecting a 1.1% decline compared to the same quarter last year [2] - Revenue is projected to be $375 million, indicating a 12.49% increase year-over-year [2] Annual Forecast - Zacks Consensus Estimates forecast earnings of $3.74 per share and revenue of $1.42 billion for the year, representing increases of +8.09% and +5.61% respectively compared to the previous year [3] Analyst Estimates - Recent changes to analyst estimates for Blue Bird are important as they reflect short-term business dynamics, with positive revisions indicating a favorable business outlook [3] Zacks Rank - Blue Bird currently holds a Zacks Rank of 5 (Strong Sell), with the consensus EPS estimate remaining unchanged over the last 30 days [5] Valuation Metrics - The company has a Forward P/E ratio of 11.02, which is in line with the industry average [6] - Blue Bird's PEG ratio is 0.93, compared to the Automotive - Domestic industry's average PEG ratio of 1.13 [7] Industry Context - The Automotive - Domestic industry ranks 215 in the Zacks Industry Rank, placing it in the bottom 13% of over 250 industries [8]

Group 1 - The company Blue Bird Corporation (NASDAQ: BLBD) is highlighted as a promising investment in the electric bus sector despite general caution in the electric vehicle market [1] - Management of Blue Bird Corporation has demonstrated strong capabilities, contributing to positive sentiment around the company's future prospects [1] Group 2 - Crude Value Insights provides an investment service focused on oil and natural gas, emphasizing cash flow and the potential for value and growth in these sectors [1] - Subscribers to Crude Value Insights gain access to a stock model account, detailed cash flow analyses of exploration and production firms, and live discussions about the sector [2]

Blue Bird, which belongs to the Zacks Automotive - Domestic industry, posted revenues of $358.85 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 7.99%. This compares to year-ago revenues of $345.92 million. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on t ...

Financial Data and Key Metrics Changes - The company achieved record quarterly revenue of $359 million, which is $13 million higher than the previous year [12][23] - Adjusted EBITDA reached $49 million, representing a 14% margin, which is 6.5% better compared to the same quarter last year [11][12] - Adjusted free cash flow for the quarter was $19 million, a decrease of $35 million year-over-year primarily due to a tax carryforward benefit in 2024 [14][23] - The company ended the quarter with $131 million in cash and reduced debt by approximately $5 million over the last year [29] Business Line Data and Key Metrics Changes - The company sold 2,295 buses in Q2, with EV sales reaching a record of 265 units, which is 26% higher than last year [12][25] - Parts sales totaled $26 million in Q2, flat compared to Q1 but a small reduction of $2 million compared to the prior year [25] - The average selling price for buses increased by approximately 3%, from $141,000 to $145,000 per unit [15][25] Market Data and Key Metrics Changes - The company ended the quarter with a backlog of nearly 5,000 units, representing over six months of production [8][14] - The mix of alternative power vehicles represented 57% of unit sales in Q2, significantly higher than the typical 10% to 15% mix for major competitors [15] Company Strategy and Development Direction - The company is focused on improving operational efficiency and investing in new product development, including a new commercial chassis scheduled to launch in 2026 [20][41] - The company aims to maintain its leadership position in the alternative power segment while also strengthening its core internal combustion engine (ICE) business [10][13] - The company is navigating tariff impacts by implementing price increases and prioritizing ICE buses over EVs until the tariff situation stabilizes [33][34] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining full-year guidance despite tariff challenges, highlighting strong market demand for school buses [6][19] - The company anticipates continued strong demand for EVs, with a forecast of 800 to 1,000 EV unit sales for the full year [16][36] - Management noted that the Clean School Bus program remains a bipartisan initiative, which is expected to continue benefiting the company [48] Other Important Information - The company has executed $40 million in share repurchases over the last nine months, with an additional $20 million remaining in the current program [29] - The company is optimistic about the future of the Clean School Bus program, with funding for rounds two and three flowing to customers [17][39] Q&A Session Summary Question: Margin improvements and long-term targets - Management indicated it is early in the new CEO's tenure to speculate on margin improvements, but operational expertise may contribute positively [53][54] Question: EV pricing expectations - Current tariffs are hindering the company's ability to reduce EV prices as planned, but there is optimism for future price reductions once the tariff situation clarifies [58][59] Question: Dealer network response to pricing - The company has not faced significant pushback from dealers regarding price increases, and competitors are also implementing similar pricing actions [69][73] Question: Clean School Bus program funding - Management confirmed that rounds two and three of funding are flowing, and there is optimism for round four, although it is still in the early stages [75][106]