BRP Inc. DOOO reported better-than-expected second-quarter financial results on Friday.BRP reported quarterly earnings of 67 cents per share which beat the analyst consensus estimate of 33 cents per share. The company reported quarterly sales of $1.374 billion which beat the analyst consensus estimate of $1.310 billion.“We are pleased with our second-quarter results which, in the macroeconomic context, were better than expected. We are coming off a successful dealer event, during which we unveiled a signifi ...

Company Overview - BRP Inc. is a global leader in powersports products, propulsion systems, and boats, with over 80 years of experience [4] - The company reported annual sales of CA$7.8 billion from over 130 countries and employs approximately 16,500 people as of January 31, 2025 [4] Upcoming Financial Results - BRP Inc. will hold its second quarter FY26 financial results conference call on August 29, 2025, at 9 am (EDT) [1] - The press release for the financial results will be distributed on Canadian and American newswires at approximately 6 a.m. (EDT) on the same day [2] Conference Call Details - Analysts can join the conference call via telephone at 1 800 717-1738 (toll-free in North America) using event code 50511 [2] - The call will be accessible via a live webcast and an archived recording will be available two hours after the event for 30 days [3]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher," contrasting with traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investing can be risky as stocks may lose momentum if future growth does not justify high valuations [1] - A safer approach involves investing in bargain stocks that exhibit recent price momentum [2] Group 2: BRP Inc. (DOOO) Performance - BRP Inc. (DOOO) has shown a four-week price change of 8.8%, indicating growing investor interest [3] - Over the past 12 weeks, DOOO's stock gained 57.1%, demonstrating its ability to deliver positive returns over a longer timeframe [4] - DOOO has a beta of 1.24, suggesting it moves 24% higher than the market in either direction [4] Group 3: Valuation and Earnings Estimates - DOOO has a Momentum Score of B, indicating a favorable time to invest [5] - The stock has a Zacks Rank 2 (Buy) due to upward trends in earnings estimate revisions, which attract more investors [6] - DOOO is trading at a Price-to-Sales ratio of 0.74, meaning investors pay 74 cents for each dollar of sales, indicating a reasonable valuation [6] Group 4: Additional Investment Opportunities - Besides DOOO, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen [7] - Zacks offers over 45 Premium Screens to help identify potential winning stock picks based on various investing styles [8]

Group 1 - BRP Inc. is currently ranked 16 in the Zacks Sector Rank for the Auto-Tires-Trucks group, which consists of 96 companies [2] - The Zacks Rank for BRP Inc. is 2 (Buy), indicating a favorable outlook based on earnings estimate revisions [3] - Over the past 90 days, the Zacks Consensus Estimate for BRP Inc.'s full-year earnings has increased by 9.8%, reflecting improved analyst sentiment [4] Group 2 - BRP Inc. has achieved a year-to-date return of approximately 13.9%, significantly outperforming the Auto-Tires-Trucks sector average return of -9.4% [4] - In comparison, Ferrari, another stock in the sector, has a year-to-date return of 11% and a Zacks Rank of 1 (Strong Buy) [5] - BRP Inc. is part of the Automotive - Original Equipment industry, which includes 50 companies, and this industry has an average gain of 7.8% this year [6] Group 3 - Investors should continue to monitor BRP Inc. and Ferrari for potential sustained strong performance in the Auto-Tires-Trucks sector [7]

Group 1 - The article is part of a series focusing on great and undercovered companies that are currently valued attractively [1] - It aims to provide in-depth analysis of business models, financials, and valuations of these companies [1] Group 2 - All financial figures discussed in the article are presented in Canadian dollars unless stated otherwise [1]

Core Insights - BRP has expanded its electric vehicle lineup to include the Can-Am Pulse and Origin motorcycles, four electric snowmobiles, the Rotax E10 racing powerpack, and the Can-Am Outlander Electric, catering to various rider needs and applications [1][7]. Electric Vehicle Offerings - The 2026 Can-Am Outlander Electric features a modular Rotax E-Power powerpack, delivering 47 hp and 53 lb-ft of torque, with a range of up to 50 miles in optimal conditions [3]. - The Outlander Electric can charge from 20% to 80% in just 50 minutes using a Level 2 charger, and it offers selectable ride modes: Normal, Sport, and Work [3][4]. - BRP's electric motorcycles, the Can-Am Pulse and Origin, are powered by an 8.9 kWh battery system, providing up to 100 miles of range in urban settings and achieving 0-60 mph in under four seconds [6]. Market Position and Strategy - BRP is positioned as a leader in the powersports industry with the most electric models across various categories, reflecting a deep understanding of customer needs [8]. - The company emphasizes intentional and strategic electrification, focusing on areas where it adds real value to customers [2]. Innovation and Development - BRP has a fully integrated in-house modular electric powertrain, which includes the battery pack, inverter, motor, charger, and control software, providing unmatched agility and performance [9]. - The company has introduced electric snowmobiles under the Ski-Doo and Lynx brands, initially targeting tour operators and ski centers, now available to consumers [7]. Company Overview - BRP Inc. is a global leader in powersports products, with annual sales of CA$7.8 billion and a workforce of approximately 16,500 employees as of January 31, 2025 [11].

BRP's electric lineup now includes the Can-Am Pulse and Origin motorcycles, four Ski-Doo and Lynx electric snowmobiles, the Rotax E10 racing powerpack for karts, and the Can-Am Outlander Electric, each designed to meet the needs of specific riders and applications. "At BRP, our approach to electrification is intentional and strategic – we electrify where it makes business sense and adds real value to customers," said José Boisjoli, President and CEO of BRP. "The Outlander Electric is a powerful, quiet, and ...

Core Insights - BRP Inc. has donated over CAD $500,000 worth of Lynx apparel to support seven Northern Communities in partnership with the Healthy Horizons Foundation [1][2] - The donation is part of BRP's Ride Out Intimidation program, which aims to improve the health and well-being of youth in these communities [1][2] - The Healthy Horizons Foundation has coordinated the distribution of the donated apparel, benefiting over one thousand individuals in small northern communities [3][4] Company Initiatives - BRP and the Healthy Horizons Foundation launched the Northy Club afterschool program in October 2024, aimed at empowering students in Northern Indigenous communities [2][5] - The Northy Club focuses on education, personal growth, and healthy lifestyles while promoting anti-bullying and intimidation prevention [5] - The program will continue in the fall of 2025 and is set to expand based on community needs [5] Organizational Background - The Healthy Horizons Foundation is dedicated to advancing the health and well-being of youth in northern and remote communities, investing in high-impact programs since its establishment in 2015 [6] - BRP Inc. is a global leader in powersports products, with annual sales of CAD $7.8 billion and a workforce of approximately 16,500 employees as of January 31, 2025 [8]

Company Overview - BRP Inc. is a global leader in powersports products, propulsion systems, and boats, with over 80 years of experience [4] - The company reported annual sales of CA$7.8 billion from over 130 countries and employs approximately 16,500 people as of January 31, 2025 [4] Upcoming Financial Results - BRP Inc. will hold its second quarter FY26 financial results conference call on August 29, 2025, at 9 am (EDT) [1] - The press release for the financial results will be distributed on Canadian and American newswires at approximately 6 a.m. (EDT) on the same day [2] Conference Call Details - Analysts can join the conference call via a toll-free number in North America, with an event code provided for access [2] - Business media are allowed to join the call but will not be permitted to ask questions [3] - A live webcast will be available, and an archived recording will be accessible for 30 days after the event [3]

```markdown PART I. FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=6&type=section&id=ITEM%201.%20Financial%20Statements%20%28Unaudited%29) The unaudited condensed consolidated financial statements for the quarterly period ended June 30, 2025, show an increase in total assets to **$3.74 billion** from **$3.53 billion** at year-end 2024. For the six months ended June 30, 2025, total revenues grew to **$792.2 million** from **$720.2 million** year-over-year, and net income increased to **$19.8 million** from **$8.2 million**. The statements also reflect a change in presentation for fiduciary assets and liabilities, now shown separately on the balance sheet [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheet Highlights (as of June 30, 2025 vs. Dec 31, 2024) | Account | June 30, 2025 ($ in thousands) | December 31, 2024 ($ in thousands) | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $105,695 | $90,045 | | Total current assets | $1,239,709 | $1,026,490 | | Goodwill | $1,420,583 | $1,412,369 | | Total assets | $3,738,985 | $3,534,731 | | **Liabilities & Equity** | | | | Total current liabilities | $1,007,489 | $1,056,434 | | Long-term debt, less current portion | $1,494,712 | $1,398,054 | | Total liabilities | $2,688,616 | $2,525,934 | | Total stockholders' equity | $1,049,924 | $1,008,344 | - **Total assets increased** from **$3.53 billion** to **$3.74 billion**, primarily driven by increases in fiduciary cash, fiduciary receivables, and goodwill. Total liabilities also increased, mainly due to a rise in long-term debt and fiduciary liabilities[16](index=16&type=chunk) [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20%28Loss%29) Statement of Comprehensive Income Highlights | Metric | Three Months Ended June 30, 2025 ($ in thousands) | Three Months Ended June 30, 2024 ($ in thousands) | Six Months Ended June 30, 2025 ($ in thousands) | Six Months Ended June 30, 2024 ($ in thousands) | | :--- | :--- | :--- | :--- | :--- | | Total revenues | $378,811 | $339,840 | $792,216 | $720,207 | | Operating income | $27,940 | $16,458 | $83,957 | $50,716 | | Net income (loss) | $(5,141) | $(30,867) | $19,757 | $8,233 | | Net income (loss) attributable to Baldwin | $(3,164) | $(17,557) | $10,775 | $4,021 | | Diluted earnings (loss) per share | $(0.05) | $(0.28) | $0.15 | $0.06 | - For the six months ended June 30, 2025, **total revenues increased by 10%** YoY to **$792.2 million**, and **operating income grew by 66%** YoY to **$84.0 million**. **Net income attributable to Baldwin significantly increased** to **$10.8 million** from **$4.0 million** in the prior year period[18](index=18&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash Flow Highlights for the Six Months Ended June 30 | Cash Flow Activity | 2025 ($ in thousands) | 2024 ($ in thousands) | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $(80,704) | $21,346 | | Net cash provided by (used in) investing activities | $(46,201) | $35,602 | | Net cash provided by financing activities | $197,838 | $76,265 | | **Net increase in cash and cash equivalents and fiduciary cash** | **$70,933** | **$133,213** | - For the six months ended June 30, 2025, **net cash used in operating activities was ($80.7 million)**, a significant shift from the **$21.3 million** provided in the same period of 2024. This was primarily due to an **$85.1 million** payment of contingent earnout consideration in excess of purchase price accrual. Net cash from financing activities increased, driven by proceeds from the revolving line of credit and debt refinancing[29](index=29&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=14&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) - **Effective January 1, 2025, the company changed its balance sheet presentation** to separately report fiduciary assets (fiduciary cash, fiduciary receivables) and fiduciary liabilities. Prior period amounts have been recast for comparability[46](index=46&type=chunk)[47](index=47&type=chunk) - **On April 1, 2025, the company acquired MultiStrat Group**, a reinsurance underwriting platform, for a total consideration of **$24.6 million**, including **$12.1 million** in cash and **$8.8 million** in contingent earnout consideration. This acquisition added **$8.2 million** in goodwill[68](index=68&type=chunk)[69](index=69&type=chunk)[76](index=76&type=chunk) - **On January 10, 2025, the company amended its credit facility**, increasing its senior secured first lien term loan facility by **$100.0 million** to a total of **$935.8 million**. The proceeds were used to repay the existing 2024 Term Loans[93](index=93&type=chunk) - **The company is appealing a Delaware Court of Chancery opinion** regarding its 2019 Stockholders Agreement and a related **$2.4 million** attorneys' fee award. Management estimates the potential loss to be between **$0** and **$2.4 million**[123](index=123&type=chunk) - **Effective January 1, 2025, the company's new captive insurance operation**, MSI Multifamily Series Protected Cell, began participating as a quota share reinsurer. For the six months ended June 30, 2025, it generated **$9.8 million** in assumed premium earned and incurred losses of **$8.8 million**[148](index=148&type=chunk)[150](index=150&type=chunk)[151](index=151&type=chunk) - **Subsequent to the quarter end, on July 1, 2025, the company acquired Hippo Holdings Inc.'s homebuilder distribution network** for **$75 million** in cash upfront and a **$25 million** deferred payment. The acquisition was funded by borrowing an additional **$68 million** on its Revolving Facility[152](index=152&type=chunk)[153](index=153&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=37&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's performance, highlighting a **10%** increase in total revenues for the first six months of 2025, driven by organic growth in core commissions and fees. Operating income grew **66%** to **$84.0 million**. The discussion details results by the three operating segments: Insurance Advisory Solutions (IAS), Underwriting, Capacity & Technology Solutions (UCTS), and Mainstreet Insurance Solutions (MIS). The company's liquidity remains strong, with **$105.7 million** in cash and **$474 million** available on its revolving facility as of June 30, 2025 [Results of Operations](index=38&type=section&id=Results%20of%20Operations) Consolidated Results of Operations Summary | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Variance % | | :--- | :--- | :--- | :--- | | Total revenues | $792,216 | $720,207 | 10% | | Colleague compensation and benefits | $393,491 | $376,714 | 4% | | Total operating expenses | $708,259 | $669,491 | 6% | | Operating income | $83,957 | $50,716 | 66% | | Income before income taxes | $20,442 | $10,384 | 97% | - For the six months ended June 30, 2025, **commissions and fees increased by 10%** (**$71.6 million**) year-over-year, driven by **$68.9 million** in organic growth from new and renewal business, strong performance from the MSI platform, and the new Captive business[170](index=170&type=chunk) - **Other operating expenses for the first six months of 2025 increased by $21.8 million** (**24%**) YoY, primarily due to **$8.8 million** in incurred losses from the new Captive business, **$5.5 million** in higher professional fees (including for the setup of the Reciprocal), and **$3.1 million** in marketing costs for rebranding[178](index=178&type=chunk) - **The gain on divestitures decreased by $36.9 million** for the six-month period, mainly because the prior year period included a **$35.1 million** gain from the sale of the Wholesale Business[183](index=183&type=chunk) [Non-GAAP Financial Measures](index=41&type=section&id=Non-GAAP%20Financial%20Measures) Adjusted EBITDA Reconciliation | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net income (loss) | $19,757 | $8,233 | | **Adjusted EBITDA** | **$199,307** | **$176,574** | | Adjusted EBITDA margin | 25% | 25% | Organic Revenue Growth | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Commissions and fees ($ in thousands) | $786,780 | $715,199 | | Organic revenue ($ in thousands) | $784,800 | $715,199 | | **Organic revenue growth %** | **11%** | **17%** | Adjusted Diluted EPS Reconciliation | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net income (loss) attributable to Baldwin ($ in thousands) | $10,775 | $4,021 | | Adjusted net income ($ in thousands) | $126,068 | $106,255 | | Diluted earnings (loss) per share | $0.15 | $0.06 | | **Adjusted diluted EPS** | **$1.06** | **$0.90** | [Segment Results](index=45&type=section&id=Segment%20Results) For the first six months of 2025, Insurance Advisory Solutions (IAS) revenues grew **5%** to **$410.9 million**. Underwriting, Capacity & Technology Solutions (UCTS) revenues grew **20%** to **$272.7 million**, driven by strong performance in its MSI platform and the new Captive business. Mainstreet Insurance Solutions (MIS) revenues grew **4%** to **$144.4 million** - **Insurance Advisory Solutions (IAS):** For the six months ended June 30, 2025, revenues increased **5%** YoY to **$410.9 million**, driven by **18%** sales velocity, though offset by a **230 bps** headwind from softening insurance rates, particularly in property lines[200](index=200&type=chunk)[203](index=203&type=chunk) - **Underwriting, Capacity & Technology Solutions (UCTS):** For the six months ended June 30, 2025, revenues increased **20%** YoY to **$272.7 million**. Core commissions and fees growth was **23%** after excluding the divested Wholesale Business, driven by outperformance in MSI, momentum in Capacity Solutions, and the new Captive business[212](index=212&type=chunk)[215](index=215&type=chunk) - **Mainstreet Insurance Solutions (MIS):** For the six months ended June 30, 2025, revenues increased **4%** YoY to **$144.4 million**, primarily due to a **$3.6 million** increase in profit-sharing revenue from improved loss ratios and policy volume[225](index=225&type=chunk)[228](index=228&type=chunk) [Liquidity and Capital Resources](index=52&type=section&id=Liquidity%20and%20Capital%20Resources) - **As of June 30, 2025, the company had $105.7 million** in cash and cash equivalents and **$474 million** of available borrowing capacity on its Revolving Facility. Management believes this is sufficient to fund working capital and commitments for the next twelve months and beyond[248](index=248&type=chunk) Contractual Obligations and Commitments (as of June 30, 2025) | Obligation Type | Total ($ in thousands) | Less than 1 year ($ in thousands) | 1-3 years ($ in thousands) | 3-5 years ($ in thousands) | More than 5 years ($ in thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | | Operating leases | $93,656 | $21,288 | $38,507 | $26,793 | $7,068 | | Debt obligations payable | $2,325,951 | $131,682 | $254,483 | $354,695 | $1,585,091 | | Undiscounted estimated contingent earnout obligation | $21,509 | $7,552 | $13,957 | — | — | | USF Grant | $3,352 | $856 | $1,696 | $800 | — | - **The maximum estimated exposure to contingent earnout liabilities was $63.2 million** at June 30, 2025. The undiscounted estimated obligation of **$21.5 million** can be settled in cash or stock at the company's option[255](index=255&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=55&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company is primarily exposed to market risk through interest rate fluctuations on its variable-rate debt. As of June 30, 2025, the company had **$1.04 billion** in outstanding variable-rate borrowings. A hypothetical **100 basis point** increase in the SOFR rate would increase annual interest expense by approximately **$10.4 million** - **The company's primary market risk is interest rate risk** on its variable-rate debt under the 2024 Credit Facility[268](index=268&type=chunk) - **As of June 30, 2025, a 100 basis point (1%) increase in the SOFR rate would result in an estimated $10.4 million** increase in annual interest expense on the company's **$1.04 billion** of variable-rate debt[270](index=270&type=chunk) [Item 4. Controls and Procedures](index=56&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of June 30, 2025. There were no material changes to the company's internal control over financial reporting during the quarter - **The CEO and CFO concluded that the company's disclosure controls and procedures were effective** as of June 30, 2025[272](index=272&type=chunk) - **No material changes were made to the internal control over financial reporting** during the quarter ended June 30, 2025[273](index=273&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=57&type=section&id=ITEM%201.%20Legal%20Proceedings) The company refers to Note 14 of the financial statements for information on legal proceedings, which details a class action lawsuit regarding the 2019 Stockholders Agreement. The company is appealing a court opinion and a related **$2.4 million** fee award - **For details on legal proceedings, the report refers to Note 14** of the condensed consolidated financial statements[274](index=274&type=chunk) [Item 1A. Risk Factors](index=57&type=section&id=ITEM%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024 - **The report refers to the Risk Factors section** of the company's Annual Report on Form 10-K for the year ended December 31, 2024, indicating no material changes[275](index=275&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=57&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities. It repurchased **106,955** shares of Class A common stock during the quarter at an average price of **$43.67** per share, primarily to cover tax withholding obligations for employees on vested stock awards - **There were no sales of unregistered securities** during the period[276](index=276&type=chunk) Issuer Repurchases of Equity Securities (Q2 2025) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2025 | 104,278 | $43.74 | | May 2025 | 2,580 | $40.75 | | June 2025 | 97 | $40.40 | | **Total** | **106,955** | **$43.67** | - **Share repurchases were made to cover required tax withholding** for employees on the vesting of stock awards and were not part of a publicly announced repurchase plan[277](index=277&type=chunk) [Item 6. Exhibits](index=58&type=section&id=ITEM%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including corporate governance documents, CEO/CFO certifications, and XBRL data files - **The exhibits filed with this report include the CEO and CFO certifications** pursuant to the Sarbanes-Oxley Act (Exhibits 31.1, 31.2, 32) and Inline XBRL documents[282](index=282&type=chunk) ```