Blue Bird (BLBD) Stock Forecast & Price Target

Blue Bird Corp has demonstrated strong financial performance, with Bus revenue for FY4Q25 reaching approximately $384 million, representing a year-over-year increase of around 19%, driven by higher deliveries and average selling prices. The company's EBITDA margins showed a positive trend, rising to about 17% for the quarter, marking an increase of approximately 480 basis points year-over-year, which indicates improved operational efficiency and profitability. Furthermore, the transition towards alternative-powered school buses is anticipated to enhance revenue, margins, and free cash flow, supporting a favorable outlook for the company's growth trajectory in the near term.

Blue Bird Corp's financial outlook is hindered by a significant decline in backlog units, which are down approximately 37% year-over-year, suggesting a potential long-term demand weakness for school buses. Additionally, the company's projected EBITDA margins are expected to contract from roughly 13.6% in FY2024 to the mid- to high-single-digit range by FY2026, exacerbating concerns over profitability. Compounding these challenges are increased competition, particularly in the electric vehicle bus segment, and potential public-sector budget constraints that threaten sales and earnings stability.