Roth Capital Raises Blue Bird Price Target to $49, Maintains Neutral Rating

Roth Capital raised Blue Bird's price target to $49 from $36 after Q3 earnings beat, but kept a Neutral rating. Backlog began to fall in April due to Trump's tariff announcements, but the company expects orders to pick up as major tariffs are settled and pricing certainty increases for school districts.

Blue Bird Corp (NASDAQ: BLBD), a leading school bus manufacturer, has seen its stock price target raised by Needham to $53.00 from $49.00, according to a recent analyst report [1]. The investment firm maintained a "Buy" rating on the stock, citing strong execution and robust financials as reasons for the upward revision. Blue Bird's third-quarter results and company commentary have been positively received by Needham, which noted "strong execution against low expectations" despite the stock's compressed multiple.

The company's financial health is reflected in its current ratio of 1.58 and a balance sheet with more cash than debt. Needham also addressed concerns about an electric vehicle (EV) school bus slowdown due to less supportive regulatory policies, stating that fears are "overblown." The firm highlighted Blue Bird's pricing power and new product initiatives as drivers of increased long-term margin guidance.

In other recent news, Blue Bird reported its fiscal Q3 2025 earnings, surpassing analysts' expectations [2]. The company achieved an earnings per share (EPS) of $1.19, compared to the forecasted $1.00, and revenue reached $398 million, exceeding the anticipated $377.64 million. These results reflect a strong performance for the company in the third quarter.

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." Despite the increase, 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.

Blue Bird Corporation also reported record revenue of $398 million for Q3, a $65 million increase from the previous year, and an adjusted EBITDA of $58 million, a $10 million increase from the prior year [2]. The company's backlog stood at 3,900 units, indicating a temporary dip due to tariff-related uncertainties affecting industry orders. Despite this, the backlog remains within the desired range, supported by fundamentals like an aging fleet and pent-up demand.

Blue Bird sold 271 units of electric buses in Q3, a 67 units increase from the previous year, and has an outlook for EVs remaining optimistic with 1,200 units either booked or in the order backlog and anticipation of 900 unit sales for the full year. The company is set to build a new factory with plans to apply production automation, automated material movement, and manufacturing execution systems to enhance cost reduction and competitive manufacturing strategies.

References:
[1] https://za.investing.com/news/analyst-ratings/blue-bird-stock-price-target-raised-to-53-from-49-at-needham-93CH-3825473
[2] https://www.ainvest.com/news/blue-bird-q3-2025-navigating-tariff-turbulence-ev-sales-uncertainty-2508/