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Thor (THO) Q1 Earnings & Revenues Lag Estimates, Down Y/Y
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Thor Industries, Inc. (THO - Free Report) reported first-quarter fiscal 2019 (ended Oct 31, 2018) adjusted earnings of $1.28 per share, missing the Zacks Consensus Estimate of $1.52. Excluding acquisition-related costs, earnings for the reported quarter were 26 cents per share. In the prior-year quarter, adjusted earnings per share were $2.43. Net income declined to $14 million from $128.4 million in the prior-year quarter, majorly due to high effective tax rate.
In the quarter under review, revenues slumped 21.3% year over year to $1.76 billion. The figure also lagged the Zacks Consensus Estimate of $1.87 billion.
Gross profit was $207 million compared with $333 million recorded in first-quarter fiscal 2018. Moreover, gross profit margin decreased to 11.8% compared with 14.9% in the year-ago quarter. The margin plummeted from the prior-year figure, majorly due to increased sales promotions and costs related to warranty expenses.
Thor Industries, Inc. Price, Consensus and EPS Surprise
High effective tax rate hampered the company’s profit margin beside rise in material costs on the implementation of tariffs. During the quarter under review, effective tax rate was 55.7% compared with 31.4% in the prior year. Thor expects normalized effective tax rate to return to 23-25% in the second half of fiscal 2019.
Segment Results
Sales of Towable RVs went down 21% year over year to $1.28 billion. The slump was due to lower unit volume and increased discounts on products. Augmented material and warranty costs lowered the segment’s gross profit margin to 12%.
Sales from Motorized RVs declined 23.9% year over year to $431.2 million due to lower volume sales. This also lowered the segment’s gross profit margin to 10.3%.
Financial Position
As of Oct 31, 2018, Thor had cash and cash equivalents of $225 million, down from $275 million as of Jul 31, 2018.
At the end of first-quarter fiscal 2019, Thor’s operating cash outflow was $15.8 million compared with an inflow of $13.4 million during the same period in the previous fiscal year.
CarGurus has an expected long-term growth rate of 5%. Shares of the company have increased by 2.3% over the past six months.
Cooper Tire has an expected long-term growth rate of 4%. Shares of the company have rallied 14.9% over the past six months.
General Motors has an expected long-term growth rate of 8.5%. Over the past three months, shares of the company have gained 2.7%.
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Thor (THO) Q1 Earnings & Revenues Lag Estimates, Down Y/Y
Thor Industries, Inc. (THO - Free Report) reported first-quarter fiscal 2019 (ended Oct 31, 2018) adjusted earnings of $1.28 per share, missing the Zacks Consensus Estimate of $1.52. Excluding acquisition-related costs, earnings for the reported quarter were 26 cents per share. In the prior-year quarter, adjusted earnings per share were $2.43. Net income declined to $14 million from $128.4 million in the prior-year quarter, majorly due to high effective tax rate.
In the quarter under review, revenues slumped 21.3% year over year to $1.76 billion. The figure also lagged the Zacks Consensus Estimate of $1.87 billion.
Gross profit was $207 million compared with $333 million recorded in first-quarter fiscal 2018. Moreover, gross profit margin decreased to 11.8% compared with 14.9% in the year-ago quarter. The margin plummeted from the prior-year figure, majorly due to increased sales promotions and costs related to warranty expenses.
Thor Industries, Inc. Price, Consensus and EPS Surprise
Thor Industries, Inc. Price, Consensus and EPS Surprise | Thor Industries, Inc. Quote
High effective tax rate hampered the company’s profit margin beside rise in material costs on the implementation of tariffs. During the quarter under review, effective tax rate was 55.7% compared with 31.4% in the prior year. Thor expects normalized effective tax rate to return to 23-25% in the second half of fiscal 2019.
Segment Results
Sales of Towable RVs went down 21% year over year to $1.28 billion. The slump was due to lower unit volume and increased discounts on products. Augmented material and warranty costs lowered the segment’s gross profit margin to 12%.
Sales from Motorized RVs declined 23.9% year over year to $431.2 million due to lower volume sales. This also lowered the segment’s gross profit margin to 10.3%.
Financial Position
As of Oct 31, 2018, Thor had cash and cash equivalents of $225 million, down from $275 million as of Jul 31, 2018.
At the end of first-quarter fiscal 2019, Thor’s operating cash outflow was $15.8 million compared with an inflow of $13.4 million during the same period in the previous fiscal year.
Zacks Rank & Stocks to Consider
Thor currently carries a Zacks Rank #4 (Sell). A few better-ranked stocks in the auto space are CarGurus, Inc. (CARG - Free Report) , Cooper Tire & Rubber Company , and General Motors Company (GM - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
CarGurus has an expected long-term growth rate of 5%. Shares of the company have increased by 2.3% over the past six months.
Cooper Tire has an expected long-term growth rate of 4%. Shares of the company have rallied 14.9% over the past six months.
General Motors has an expected long-term growth rate of 8.5%. Over the past three months, shares of the company have gained 2.7%.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>