Blue Bird Corp., which has a market cap of about $2 billion, has started to diversify from its diesel and gas-power buses to electric, boosted by government funding.
In its fiscal second-quarter earnings report released last month, Blue Bird said its revenue grew 15% year-over-year to $346 million, outpacing analysts' estimates by nearly $50 million, while its profits more than tripled to $0.89 per share. Helping fuel Blue Bird's EV school bus business is the US Environmental Protection Agency's Clean School Bus Program, which was established in the 2021 Bipartisan Infrastructure Law and provides $5 billion in funding to replace diesel school buses with electrified buses.
A big benefit to Blue Bird is that electric school buses will significantly increase its average selling price and profit margins on the vehicles it produces.