What Happened?
Shares of RV Manufacturer Winnebago (NYSE: WGO) jumped 2.7% in the morning session after competitor Thor Industries (THO) reported fourth-quarter earnings and revenue that significantly surpassed analyst expectations, signaling potential strength in the recreational vehicle market.
Thor, a major player in the RV industry, announced earnings of $2.31 per share, which was a substantial beat over the consensus estimate of $1.16 per share. The company also posted revenues of $2.52 billion for the quarter, exceeding forecasts. These strong results from a key industry peer suggested that consumer demand for recreational vehicles might have been more robust than previously thought. This positive news from Thor likely boosted investor confidence in the broader sector, lifting shares of other RV makers like Winnebago.
After the initial pop the shares cooled down to $33.97, up 2.5% from previous close.
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What Is The Market Telling Us
Winnebago’s shares are very volatile and have had 22 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 11 months ago when the stock dropped 10.9% on the news that the company reported disappointing third-quarter earnings results, with revenue, EPS, and adjusted EBITDA falling below Wall Street's estimate. Management highlighted various headwinds, including "uncertain retail conditions, higher inventory carrying costs, and slightly elevated inventories in the motorhome segment, leading to continued dealer hesitancy and increased promotional efforts." Similarly, revenue and EPS guidance for FY'2025 fell below consensus estimates. Overall, it was a weaker quarter for the company.
Winnebago is down 29.4% since the beginning of the year, and at $33.97 per share, it is trading 47.8% below its 52-week high of $65.10 from November 2024. Investors who bought $1,000 worth of Winnebago’s shares 5 years ago would now be looking at an investment worth $693.88.
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