Fundamentals underlying boat market remain strong (for now).
US Labor dept just announced
October's jobs' figures. Added a better than expected 261k non-farm jobs. Unemployment did move slightly higher to 3.7%, and y/y wages increased 4.7%. There are still two jobs for every unemployed person looking for work. Labor participation rate dropped slightly to 62.2%, down slightly from 62.4%, which is inline with pre-pandemic levels.
People are buying stuff and remain optimistic. PCE (Personal Consumption Expenditures - how the US Govt tracks consumerism) rose 0.6% in September for a seasonally adjusted 5.1%. Starbucks, for example, just reported stronger than expected earnings despite severe drag in China due to Covid lockdowns. USLUX, an ETF comprised of luxury brands such as Mercedes, Tesla, LVMH, Dior, etc, is however down 30% YTD.
The Tech Sector has, this week, announced several hiring pauses indicating a labor saturation point which could be a harbinger for other sectors.
Overall, while there are obviously possible storm clouds on the horizon, buyers of boats in the TF demographic appear to be in good financial condition to sustain purchases of 6-7 figure assets. In my opinion, the two biggest factors that could dampen interest is increased interest rates on home equity loans; and a change in employment and wages. The former, higher finance costs, has already happened and will depress demand as people forego purchases. The latter, increased unemployment, would accelerate supply as people shed assets and payments to make ends meet.
For those who predict dire catastrophy in the boat resale market, I would be interested in your underlying data that support the hypothesis. And why MarineMax (ticker: HZO) reported last week y/y sales increase of 16% which greatly exceeded analyst estimates.
Peter