--- title: "BRP (TSX:DOO) Q1 EPS Compression Tests Bullish Margin Recovery Narrative" type: "News" locale: "en" url: "https://longbridge.com/en/news/288127682.md" description: "BRP reported Q1 fiscal 2027 revenue of C$2.4 billion and basic EPS of C$1.75, down from C$2.21 a year earlier despite higher sales. Trailing 12-month net margin stands at 3.4%, with TTM EPS at C$4.23, up 68.8% YoY but contrasting with a declining five-year trend. The stock trades at a P/E of 18.9x, below peer averages, while DCF models suggest significant upside to C$248.37, highlighting mixed investor sentiment on margin recovery sustainability." datetime: "2026-05-30T01:23:32.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/288127682.md) - [en](https://longbridge.com/en/news/288127682.md) - [zh-HK](https://longbridge.com/zh-HK/news/288127682.md) --- # BRP (TSX:DOO) Q1 EPS Compression Tests Bullish Margin Recovery Narrative ## BRP (TSX:DOO) kicks off 2027 with higher revenue and solid EPS in Q1 BRP (TSX:DOO) opened fiscal 2027 with Q1 revenue of C$2.4 billion and basic EPS of C$1.75, setting the tone for how its earnings story is evolving. The company has seen quarterly revenue move from C$1.8 billion in Q1 2026 to C$2.4 billion in Q1 2027, while basic EPS shifted from C$2.21 to C$1.75 over the same period, against a backdrop of trailing 12 month EPS of C$4.23. With earnings over the past year improving 68.8% and margins sitting on a 3.4% net level, this update gives you a clearer read on how profit quality is tracking into the new fiscal year. See our full analysis for BRP. With the headline numbers on the table, the next step is to see how this earnings profile lines up against the key narratives around BRP's growth, risk, and long term profit potential. See what the community is saying about BRP TSX:DOO Earnings & Revenue History as at May 2026 ## Net margin at 3.4% with one off loss in the background - On a trailing 12 month basis, BRP generated C$8.99b in revenue and C$309.5 million in net income excluding extra items, which works out to a 3.4% net margin compared with 2.4% a year earlier, while that period also included a C$243.7 million one off loss from discontinued operations. - What stands out for the bullish narrative is that margin improvement and a 68.8% earnings lift over the past year line up with the view that cost savings and higher margin products can help earnings. However, the presence of that large one off loss means margin recovery is not a clean trend and investors need to separate ongoing profitability from special items. - Bulls point to higher margin opportunities from digital and aftermarket revenue, but the 3.4% net margin still leaves limited room for error if costs rise again. - The C$309.5 million of trailing net income is well below the bullish narrative figures for future earnings, so the current margin base is relatively low versus those expectations. Bulls argue that this early margin lift is the start of a longer earnings ramp, while skeptics question how much of it is repeatable once the one off loss rolls out of the comparison. To see how that debate plays out across different scenarios for BRP, have a look at the detailed bull case for the stock **🐂 BRP Bull Case** ## TTM EPS of C$4.23 vs mixed multi year trend - BRP's trailing 12 month basic EPS sits at C$4.23, up from C$2.50 a year earlier, even though the longer five year trend shows earnings declining at an average of 23.1% per year over that period. - This history gives bears some backing, because the recent 68.8% one year EPS improvement contrasts with a weaker multi year trend and supports the cautious view that earnings may be sensitive to cycles in discretionary spending. - Bears highlight that demand for powersports vehicles can soften when financing costs are high, which helps explain why a single strong year does not fully offset several weaker years of EPS performance. - The move from C$2.50 to C$4.23 TTM EPS is encouraging, but it sits against that longer term decline profile, so anyone leaning toward the bearish narrative will likely want more than one strong year before treating the turnaround as established. Skeptics warn that one better year of EPS on C$4.23 might not be enough to reset the story if macro conditions tighten again, so it can be useful to see how the bear case frames that risk across different cycles **🐻 BRP Bear Case** ## Valuation sits between P/E multiples and DCF fair value - At a share price of C$79.70, BRP trades on a trailing P/E of 18.9x, slightly above the Global Leisure industry average of 17.2x but well below a cited peer average of 33.9x, while a DCF fair value of C$248.37 suggests a much higher level than where the stock currently sits. - Consensus narrative points to this mix of signals as a key tension, with the current P/E indicating the stock is not especially cheap versus the wider industry, yet the DCF fair value implies a large gap to intrinsic value that investors need to judge for themselves. - The difference between C$79.70 and the DCF fair value of C$248.37 is large, so readers should consider how much weight to place on that model versus the more modest earnings and revenue profile reported today. - Forecasts for earnings growth of about 20.6% per year and revenue growth of 3.9% per year help explain why some investors are comfortable paying a P/E just above the sector average, even though revenue growth is slower than the 4.8% Canadian market forecast. ## Next Steps To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for BRP on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves. With both upside and downside threads running through this story, it is worth checking the underlying data yourself and forming your own take. To round out that view and see how current sentiment breaks down, make time to review the 3 key rewards and 2 important warning signs ## See What Else Is Out There BRP's relatively low 3.4% net margin, mixed multi year EPS trend, and P/E slightly above its industry average suggest limited room for error and valuation tension. If that mix of thin margins and past earnings volatility makes you cautious, you can quickly compare with companies that look more attractively priced using the 8 high quality undervalued stocks. _This article by Simply Wall St is general in nature. **We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice.** It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned._ ### Valuation is complex, but we're here to simplify it. Discover if BRP might be undervalued or overvalued with our detailed analysis, featuring **fair value estimates, potential risks, dividends, insider trades, and its financial condition.** Access Free Analysis ### Related Stocks - [DOO.US](https://longbridge.com/en/quote/DOO.US.md) - [DOOO.US](https://longbridge.com/en/quote/DOOO.US.md) ## Related News & Research - [BRP Announces Elections of Directors and Board Committee Composition | DOO Stock News](https://longbridge.com/en/news/287969367.md) - [BRP Wins Four Red Dot Design Awards, Including a Prestigious "Best of the Best" | DOO Stock News](https://longbridge.com/en/news/292324909.md) - [/R E P E A T -- BRP Will Present Its First Quarter Fiscal Year 2027 Results and Hold Its Annual Meeting of Shareholders/ | DOO Stock News](https://longbridge.com/en/news/287225369.md) - [Powersports maker BRP's Q1 results beat despite tariff impact](https://longbridge.com/en/news/287897782.md) - [Stifel Nicolaus downgrades BRP (DOO) to a Hold](https://longbridge.com/en/news/287996993.md)