Holley (NYSE:HLLY) Issues Earnings Results, Beats Estimates By $0.08 EPS

Holley (NYSE:HLLY) released its quarterly earnings data on Wednesday. The company reported $0.20 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.12 by $0.08, FiscalAI reports. The business had revenue of $172.01 million during the quarter, compared to analyst estimates of $172.63 million. Holley had a return on equity of 8.42% and a net margin of 1.68%.

Here are the key takeaways from Holley’s conference call:

• Holley returned to growth in Q2, with net sales up 3.2% to $172 million and core sales up 4.9%; three of four divisions delivered double-digit core growth. Modern Truck & Off-Road, Euro & Import, and Safety & Racing grew 15.7%, 13.1%, and 13.8%, respectively.
• Reported profitability was pressured by tariffs and lower volume, with gross margin down 72 basis points to 41% and adjusted EBITDA margin down 223 basis points to 19.6%. Management said adjusted EBITDA would have been roughly flat year over year excluding a prior-year, non-cash tariff capitalization benefit of approximately $3 million-$3.5 million.
• Free cash flow rose to $40.9 million, leverage fell to 3.74 times, and Holley made an additional $15 million debt repayment after quarter-end, keeping it on track to finish 2026 below 3.5 times leverage. The company also repurchased approximately $2 million of shares during the quarter.
• Management reaffirmed full-year guidance and cited approximately $12 million of new national retailer placements scheduled for Q3, a strong second-half product pipeline, normalized channel inventories, improved marketing execution, and continued contributions from HRX as support for stronger momentum.
• Holley completed the divestiture of its non-core Restoration brands and has now divested four of five targeted businesses, eliminated two facilities, reduced its warehouse footprint by about 95,000 square feet, and removed roughly 7,000 low-margin SKUs. These actions are intended to simplify operations and generate annualized margin and cash-flow benefits, but the divestiture produced a GAAP net loss in Q2.

Holley Price Performance

Shares of HLLY stock traded up $0.17 during mid-day trading on Friday, hitting $3.17. 1,321,142 shares of the stock traded hands, compared to its average volume of 838,299. Holley has a twelve month low of $2.33 and a twelve month high of $4.48. The company has a debt-to-equity ratio of 1.16, a quick ratio of 1.07 and a current ratio of 3.17. The company’s 50-day simple moving average is $2.59 and its 200-day simple moving average is $3.12. The firm has a market cap of $385.64 million, a price-to-earnings ratio of 39.69 and a beta of 1.31.

Holley declared that its Board of Directors has initiated a share repurchase plan on Tuesday, May 26th that permits the company to buyback $25.00 million in shares. This buyback authorization permits the company to purchase up to 8.2% of its shares through open market purchases. Shares buyback plans are generally an indication that the company’s board believes its stock is undervalued.

Hedge Funds Weigh In On Holley

Several large investors have recently made changes to their positions in the business. Invesco Ltd. raised its holdings in shares of Holley by 18.1% in the 4th quarter. Invesco Ltd. now owns 120,172 shares of the company’s stock worth $496,000 after purchasing an additional 18,440 shares in the last quarter. Empowered Funds LLC grew its position in Holley by 44.3% in the fourth quarter. Empowered Funds LLC now owns 505,929 shares of the company’s stock worth $2,089,000 after buying an additional 155,208 shares during the last quarter. Balyasny Asset Management L.P. acquired a new stake in shares of Holley during the 4th quarter valued at $102,000. Bridgeway Capital Management LLC boosted its stake in shares of Holley by 31.0% during the 4th quarter. Bridgeway Capital Management LLC now owns 913,229 shares of the company’s stock worth $3,772,000 after acquiring an additional 216,208 shares in the last quarter. Finally, AQR Capital Management LLC grew its holdings in shares of Holley by 60.1% in the 4th quarter. AQR Capital Management LLC now owns 238,136 shares of the company’s stock worth $984,000 after acquiring an additional 89,394 shares during the last quarter. Institutional investors own 39.70% of the company’s stock.

Analysts Set New Price Targets

Several equities analysts have recently commented on HLLY shares. Freedom Capital upgraded shares of Holley to a “strong-buy” rating in a research report on Tuesday, July 7th. Weiss Ratings lowered shares of Holley from a “hold (c-)” rating to a “sell (d+)” rating in a research note on Wednesday, June 17th. Benchmark dropped their price target on shares of Holley from $4.50 to $4.00 and set a “buy” rating on the stock in a research note on Friday, May 8th. Wall Street Zen cut Holley from a “buy” rating to a “hold” rating in a research note on Saturday, May 9th. Finally, Canaccord Genuity Group reissued a “buy” rating and set a $7.00 price target on shares of Holley in a report on Monday, June 29th. One research analyst has rated the stock with a Strong Buy rating, three have issued a Buy rating, one has issued a Hold rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and a consensus price target of $4.90.

About Holley

Holley Inc is a designer, manufacturer and marketer of high‐performance automotive products for the enthusiast market. Through its portfolio of well‐known brands, the company develops fuel delivery systems, intake manifolds, ignition components, nitrous oxide systems, digital controls and other engine‐dress accessories tailored to both street and competition applications. Holley’s products are sold through a network of domestic and international distributors, retailers and directly to professional race teams and hobbyists.

The company’s product offerings span mechanical and electronic fuel injection, carburetion, engine management, add‐on power systems and calibration tools.