Thor Industries, Inc. (THO - Free Report) reported third-quarter fiscal 2019 (ended Apr 30, 2019) earnings of $1.65 per share, missing the Zacks Consensus Estimate of $1.74. The figure includes acquisition-related costs and purchase accounting adjustments related to the EHG acquisition. In the prior-year quarter, earnings per share were $2.54.
Net income attributable to the company was $32.7 million compared with $133.8 million in the prior-year quarter.
Reportedly, net sales grew 11.3% year over year to $2.51 billion. However, the figure lagged the Zacks Consensus Estimate of $2.67 billion. The figure includes $767.5 million in net sales from Thor’s European RV segment, partly offset by a 23.1% year-over-year decline in North American Towable RV sales and a 23.3% slump in North American Motorized RV sales.
Thor Industries, Inc. Price, Consensus and EPS Surprise
Gross profit was $292 million in the quarter compared with $316 million recorded in third-quarter fiscal 2018. Moreover, gross profit margin decreased to 11.7% from 14.1% in the year-ago quarter.
Favorable impact of foreign rate differences, resulting from the acquisition of EHG, aided Thor. In the reported quarter, effective tax rate was 24.3% compared with 25.9% in the prior-year quarter. For the rest of fiscal 2019, the company expects effective tax rate to be 21-23%.
Segment Results
Sales from North American Towable RVs were $1.24 billion, marking a year-over-year decline from $1.61 billion. This slump resulted from lower unit volume. Augmented softening volume sales and lowered overhead costs resulted in income before tax of $103.7 million compared with $147.9 million in the third quarter of last year.
Sales from North American Motorized RVs were $459.2 million compared with the year-ago figure of $598.5 million. This decline resulted from lower unit sales. This also lowered the segment’s income before tax to $25.2 million from the prior year’s figure of $38.9 million.
After the acquisition of EHG in February 2019, Thor added a new segment known as European RVs. The segment’s quarterly sales were $767.5 million, with loss before tax of $30.9 million.
Financial Position
As of Apr 30, 2019, Thor had cash and equivalents of $486.9 million, up from $275 million as of Jul 31, 2018.
In the first nine-month period of fiscal 2019, the company’s operating cash outflow was $175.8 million against an inflow of $197.2 million during the same period of the previous fiscal year.
Zacks Rank & Stocks to Consider
Thor currently carries a Zacks Rank #5 (Strong Sell). A few better-ranked stocks in the broader auto sector are Navistar International Corporation , Ford Motor Company (F - Free Report) and Allison Transmission Holdings, Inc. (ALSN - Free Report) , each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Navistar has an expected long-term growth rate of 15.5%. The stock has gained 28.1% in the past six months.
Ford has an expected long-term growth rate of 7.3%. The stock has gained 13.6% in the past six months.
Allison Transmission has an expected long-term growth rate of 10%. Over the past six months, shares of the company have gained 2.5%.
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Thor Industries, Inc. (THO - Free Report) reported third-quarter fiscal 2019 (ended Apr 30, 2019) earnings of $1.65 per share, missing the Zacks Consensus Estimate of $1.74. The figure includes acquisition-related costs and purchase accounting adjustments related to the EHG acquisition. In the prior-year quarter, earnings per share were $2.54.
Net income attributable to the company was $32.7 million compared with $133.8 million in the prior-year quarter.
Reportedly, net sales grew 11.3% year over year to $2.51 billion. However, the figure lagged the Zacks Consensus Estimate of $2.67 billion. The figure includes $767.5 million in net sales from Thor’s European RV segment, partly offset by a 23.1% year-over-year decline in North American Towable RV sales and a 23.3% slump in North American Motorized RV sales.
Thor Industries, Inc. Price, Consensus and EPS Surprise
Gross profit was $292 million in the quarter compared with $316 million recorded in third-quarter fiscal 2018. Moreover, gross profit margin decreased to 11.7% from 14.1% in the year-ago quarter.
Favorable impact of foreign rate differences, resulting from the acquisition of EHG, aided Thor. In the reported quarter, effective tax rate was 24.3% compared with 25.9% in the prior-year quarter. For the rest of fiscal 2019, the company expects effective tax rate to be 21-23%.
Segment Results
Sales from North American Towable RVs were $1.24 billion, marking a year-over-year decline from $1.61 billion. This slump resulted from lower unit volume. Augmented softening volume sales and lowered overhead costs resulted in income before tax of $103.7 million compared with $147.9 million in the third quarter of last year.
Sales from North American Motorized RVs were $459.2 million compared with the year-ago figure of $598.5 million. This decline resulted from lower unit sales. This also lowered the segment’s income before tax to $25.2 million from the prior year’s figure of $38.9 million.
After the acquisition of EHG in February 2019, Thor added a new segment known as European RVs. The segment’s quarterly sales were $767.5 million, with loss before tax of $30.9 million.
Financial Position
As of Apr 30, 2019, Thor had cash and equivalents of $486.9 million, up from $275 million as of Jul 31, 2018.
In the first nine-month period of fiscal 2019, the company’s operating cash outflow was $175.8 million against an inflow of $197.2 million during the same period of the previous fiscal year.
Zacks Rank & Stocks to Consider
Thor currently carries a Zacks Rank #5 (Strong Sell). A few better-ranked stocks in the broader auto sector are Navistar International Corporation , Ford Motor Company (F - Free Report) and Allison Transmission Holdings, Inc. (ALSN - Free Report) , each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Navistar has an expected long-term growth rate of 15.5%. The stock has gained 28.1% in the past six months.
Ford has an expected long-term growth rate of 7.3%. The stock has gained 13.6% in the past six months.
Allison Transmission has an expected long-term growth rate of 10%. Over the past six months, shares of the company have gained 2.5%.
Will you retire a millionaire?
One out of every six people retires a multimillionaire. Get smart tips you can do today to become one of them in a new Special Report, “7 Things You Can Do Now to Retire a Multimillionaire.”
Click to get it free >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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