Blue Bird (BLBD) Stock Forecast & Price Target

Blue Bird Corp's bus revenue for FY4Q25 reached approximately $384 million, constituting around 94% of total revenue, and reflecting a year-over-year increase of about 19% driven by higher deliveries and average selling prices. Additionally, the company's EBITDA margins improved to approximately 17%, marking a substantial year-over-year increase of about 480 basis points, supported by consistent revenue growth and enhanced delivery performance. Looking ahead, Blue Bird is expected to benefit from the shift towards alternative-powered buses, which should contribute to sustained high-single-digit revenue growth and further expansion of EBITDA margins in the coming years.

Blue Bird Corp's financial outlook is marred by a notable decline in backlog units, which dropped approximately 37% year-over-year, indicating potential challenges in sales and revenue generation. Furthermore, profitability metrics exhibit a concerning trend, with expected EBITDA margins projected to contract significantly from 13.6% in FY2024 to a mid- to high-single-digit range by FY2026, coupled with pressures on gross margins that, despite a year-over-year increase, reflect a sequential decline. Additionally, the company faces heightened competition in the electric vehicle bus sector, reliance on a limited number of key suppliers, and potential public-sector budget constraints, all of which could adversely impact its ability to meet growth targets and maintain financial stability.