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Investing.com - Needham has raised its price target on Blue Bird Corp (NASDAQ:BLBD) to $53.00 from $49.00 while maintaining a Buy rating on the school bus manufacturer’s stock. Currently trading at $44.14, the company maintains a "GREAT" financial health score according to InvestingPro analysis, with analysts’ targets ranging from $36 to $68.
The price target increase follows Blue Bird’s third-quarter results and company commentary, with Needham citing "strong execution against low expectations" despite the stock’s compressed multiple. The company’s strong execution is reflected in its robust financials, with a healthy current ratio of 1.58 and more cash than debt on its balance sheet.
Needham notes that fears of an electric vehicle school bus slowdown due to less supportive regulatory policies appear "overblown," with pricing power and new product initiatives driving increased long-term margin guidance.
The new $53 target represents approximately 7.5 times Needham’s fiscal year 2026 adjusted EBITDA estimate, which the firm describes as "roughly inline with BLBD’s historical average multiple."
Needham considers its target conservative given Blue Bird’s "much improved margin profile driving a higher ROIC" and what it views as "conservative margin assumptions" compared to the company’s updated long-term outlook.
In other recent news, Blue Bird Corporation reported its fiscal Q3 2025 earnings, surpassing analysts’ expectations. The company achieved an earnings per share (EPS) of $1.19, compared to the forecasted $1.00. Additionally, Blue Bird’s revenue reached $398 million, exceeding the anticipated $377.64 million. These results reflect a strong performance for the company in the third quarter. The positive earnings and revenue figures have been noted by market analysts, although no specific upgrades or downgrades were reported. Investors and market observers continue to monitor Blue Bird’s financial health and strategic moves. These recent developments underscore Blue Bird’s ability to exceed market expectations.
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