One-glance verdict
Within fair range
$2.07 our estimate vs market $2.55
Wall Street consensus: $4.58 (120.9% higher than our fair-value estimate)
23% above our estimate
Fundamentals snapshot
Holley Inc.
HLLY · NYQ · Consumer Cyclical · Auto Parts
Current price
$2.55
52-week range
$2.25 - $4.48
Market cap
$309.04M
Balance sheet
Stretched
1.65x Concerning
Net debt $501.08M. Interest coverage shows how many times profit covers the interest bill.
What stands out
2 Rewards
2 Risks
2 rewards · 2 risks
- Reward Returns 2.3% on equity, ahead of 60% of its peers.
- Reward Free cash flow was positive in 6/10 years.
- Risk Stock trades 33.9% above its 5-year average P/E.
- Risk Insider ownership is only 5.4% (peer median: 5.4%).
What this company does
Holley Inc.
Holley Inc. makes cool parts for cars and trucks that make them go faster or look better. They sell these parts mainly to car lovers in the US, Canada, and Europe. This matters because the money they make from selling these popular performance parts helps them keep making new products and grow their business.
How the company got here
Holley's story began in 1896 with brothers George and Earl Holley, who initially built a three-wheeled vehicle. They soon shifted their focus to carburetors, becoming a major supplier for Ford's Model T in 1903. Over the decades, Holley grew by acquiring other well-known automotive brands, expanding its offerings beyond carburetors to include a wide range of performance parts. This strategy has positioned Holley as a comprehensive provider for automotive enthusiasts, building on over a century of innovation and a deep connection with car culture.
What it actually does
Holley designs, manufactures, and sells aftermarket parts for cars and trucks, primarily aimed at enthusiasts who want to improve their vehicle's performance, appearance, or capability. Think of it as a one-stop shop for car upgrades. They offer everything from engine components like carburetors and fuel injection systems to exhaust parts, safety equipment, and even electronic tuners that help optimize a car's performance. These products are sold under various well-known brands, catering to a wide range of vehicle types and modifications.
American Performance
This is Holley's largest business segment, making up about 64% of its revenue. It focuses on parts for classic and modern American muscle cars and trucks. This includes a wide array of products such as carburetors, fuel injection systems, exhaust headers, and engine tuning devices designed to boost horsepower and improve the driving experience for enthusiasts of these iconic vehicles. Customers in this segment are typically looking to enhance the power, sound, and overall performance of their American-made cars and trucks.
Modern Truck & Off-Road
This segment, representing about 20% of Holley's revenue, caters to owners of modern trucks and those who enjoy off-roading. The products here are designed for durability and enhanced performance in demanding conditions. This can include parts that improve a truck's capability for towing, off-road trails, or general utility, as well as components that enhance the driving experience for everyday use. The focus is on ruggedness and performance for vehicles often used for work or adventure.
Safety & Racing
Making up about 10% of Holley's revenue, this segment is dedicated to products that enhance safety and performance in competitive racing environments. This includes specialized safety gear like racing suits and helmets, as well as high-performance components engineered for the rigors of the racetrack. Customers in this segment are typically professional racers, serious amateur competitors, or individuals who prioritize safety and peak performance in motorsports.
Euro & Import
This smaller segment, accounting for about 5% of revenue, focuses on performance aftermarket parts for European and other imported vehicles. While Holley is historically known for American muscle cars, this segment shows their expansion into serving a broader enthusiast market. Products here are designed to enhance the performance and customization of non-American vehicles, catering to a different set of automotive tastes and engineering.
What management is betting on now
Holley's management is focused on accelerating growth by better serving distinct customer groups through a reorganized structure of market segments. They are also actively managing their debt, having significantly reduced it using free cash flow, which strengthens their financial position. Additionally, Holley is pursuing strategic acquisitions, like HRX, to expand its capabilities and market reach, particularly in areas like racewear and European motorsports. This strategy aims to enhance profitability, improve cash flow, and create long-term shareholder value by focusing on core strengths and expanding into new opportunities.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$-3.48M
FY2024 Q4
$1.69M
FY2025 Q1
$-10.83M
FY2025 Q2
$35.66M
FY2025 Q3
$5.29M
FY2025 Q4
$3.79M
FY2026 Q1
$-6.33M
FY2026 Q2
$40.94M
Revenue
$172.01M
Net income
$-2.43M
Diluted EPS
-0.02
Operating cash flow
$47.11M
Free cash flow
$40.94M
Fetching…
Sources
Revenue
$147.33M
Net income
$7.26M
Diluted EPS
0.06
Operating cash flow
$-2.86M
Free cash flow
$-6.33M
Fetching…
Sources
Revenue
$155.44M
Net income
$6.30M
Diluted EPS
0.06
Operating cash flow
$6.15M
Free cash flow
$3.79M
Fetching…
Sources
Revenue
$138.37M
Net income
$-806.00K
Diluted EPS
-0.01
Operating cash flow
$7.43M
Free cash flow
$5.29M
Fetching…
Sources
Revenue
$166.66M
Net income
$10.86M
Diluted EPS
0.09
Operating cash flow
$40.49M
Free cash flow
$35.66M
Fetching…
Sources
Revenue
$153.04M
Net income
$2.82M
Diluted EPS
0.02
Operating cash flow
$-7.85M
Free cash flow
$-10.83M
Fetching…
Sources
Revenue
$140.05M
Net income
$-27.76M
Diluted EPS
-0.32
Operating cash flow
$4.13M
Free cash flow
$1.69M
Fetching…
Sources
Revenue
$134.04M
Net income
$-6.29M
Diluted EPS
-0.05
Operating cash flow
$-1.75M
Free cash flow
$-3.48M
Fetching…
Sources
Is it cheap or expensive?
Fair value $2.07 vs current price $2.55
Wall Street consensus is the average analyst price target: $4.58 (120.9% higher than our fair-value estimate).
Our most-likely fair value is $2.07 a share — about 18.7% away from today's price of $2.55, so the stock currently looks fairly priced.
Is it drowning in debt?
Stretched
Net debt $501.1M. Interest coverage 1.6x.
Net debt
$501.08M
Interest coverage
1.65x
Holley Inc.'s profit covers its interest bill about 1.6 times over. which is stronger than most peers shown here and 3 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Stretched
Worse cushion
Baseline
Better cushion
HLLY
BASELINE
Holley Inc.
Total debt $570.10M Interest coverage 1.65x This is the baseline the peer rows are being compared against.
Total debt $680.16M Interest coverage 0.89x -46% vs HLLY Carries about 1.8x less debt cushion than HLLY.
Total debt $697.76M Interest coverage 4.44x +169% vs HLLY Carries about 2.7x more debt cushion than HLLY.
Total debt $232.86M Interest coverage 1.22x -26% vs HLLY Carries about 1.4x less debt cushion than HLLY.
Total debt $146.52M Interest coverage -0.05x -100% vs HLLY This peer has almost no interest-payment cushion compared with HLLY.
Total debt $1.24B Interest coverage 0.93x -43% vs HLLY Carries about 1.8x less debt cushion than HLLY.
What you should know
The case for and against HLLY
2 Rewards
2 Risks
Rewards
-
Returns 2.3% on equity, ahead of 60% of its peers.
-
Free cash flow was positive in 6/10 years.
Risks
-
Stock trades 33.9% above its 5-year average P/E.
-
Insider ownership is only 5.4% (peer median: 5.4%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
31.86x
Forward P/E
6.58x
P/B
0.67x
P/S
0.50x
EV/EBITDA
7.22x
PEG ratio
0.25x
Profitability
How much profit each dollar creates
Gross margin
43.0%
Operating margin
18.5%
Net margin
1.7%
ROE
2.3%
ROA
4.7%
Health
Liquidity and balance-sheet strength
Debt / equity
1.27x
Current ratio
3.06x
Quick ratio
1.23x
Total debt
$570.10M
Total cash
$69.02M
Growth
How the business has been compounding
Revenue TTM
$613.15M
Revenue 5Y CAGR
-3.0%
EPS TTM
0.08
EPS 5Y CAGR
4.6%
Cash flow
How much cash the business throws off
Operating CF TTM
$57.84M
Free CF TTM
$33.90M
FCF margin
5.5%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
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