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Camping World (CWH - Free Report) is a Zacks Rank #1 (Strong Buy) that is a provider of services, protection plans, products and resources for recreational vehicle enthusiasts.
After doubling from the COVID lows last year, the stock has struggled as of late. Investors seem to be concerned that the momentum from last year has faded and the stock is now off over 25% from highs.
Recent earnings were solid so investors should be watching for a bounce opportunity as the stock tests support levels.
About the Company
Camping World is headquartered in Lincolnshire, Illinois and employs over 10,000 people. The company was founded in 1966 and operates a network of 170 retail locations in 38 states. The company operates in two segments, Good Sam and Plans; and RV and Outdoor Retail.
CWH is valued at $3 billion and has a Forward PE of 6. The company holds a Zacks Style Score of “A” in Momentum, Growth and Value. The stock also pays a 2.7% dividend.
Travel Has Changed
COVID-19 brought a halt to travel at the height of the pandemic. Because the U.S. had one of the highest cases counts, many countries issued quarantine rules for American travelers. This wasn’t appealing for a vacation so we saw a surge in domestic travel here at home. Since all the hotels were closed, the demand for RV’s and the desire to camp increased.
While America has opened up, the demand for camping is still there as we head through the summer months. In April, the RV industry Association reported March shipments at 54.3k v 30.3k a year ago, up 47.9%. We saw proof of this momentum when RV marker Thor Industries reported earnings a few weeks ago and saw a massive order backlog.
Q1 Earnings Beat
Thor isn’t the only one having success, as both Winnebago and Camping World have all reported fantastic numbers last quarter. In fact, Camping World has beaten EPS expectations for five straight quarters.
Looking at the last quarter, the company reported in early May and saw a 159% EPS beat. Q1 came in at $1.40 v $0.54 expected, with revenues at $1.56B v $1.27B expected. The company also raised FY21 adj EBITDA to $770-810M and sees adjusted EBITDA at $189.3M v $36M year over year. Moreover, margins came in higher, up to 12.2% v 3.5% a year ago.
A few weeks after earnings, the company raised its quarterly dividend 8.7% to $0.25 from $0.23. This would give investors a yield of about 2.7% at the current stock price.
Camping World Holdings Inc. Price and EPS Surprise
Over the last 60 days, estimates are rising over all time frames. For the current quarter, analysts have raised estimates from $1.54 to $2.23, a hike of 45%. For the current year, we see an 28% hike, from $4.31 to $5.54.
The Technical Take
The stock has a volatile track record, moving from $3 at the height of the pandemic to $48 just a few months ago. There has been selling as of late, with the stock falling over 25% off its highs.
We are now down to the 200-day Moving average, a support level that has seen three significant bounces since November of last year. This area could start a bounce, back to the 50-day MA at $42. However, if it fails, expect the stock to find the $30 level.
In Summary
Campers are big business and the pandemic created record demand. While we might get some normalization in future earnings, this summer should continue to stay hot for the manufacturers and Camping World.
Bulls finally are getting a good price to buy as the stock falls into technical support. Additionally, the dividend allows longer-term investors to get paid while they camp out in Camping World.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Bull of the Day: Camping World (CWH)
Camping World (CWH - Free Report) is a Zacks Rank #1 (Strong Buy) that is a provider of services, protection plans, products and resources for recreational vehicle enthusiasts.
After doubling from the COVID lows last year, the stock has struggled as of late. Investors seem to be concerned that the momentum from last year has faded and the stock is now off over 25% from highs.
Recent earnings were solid so investors should be watching for a bounce opportunity as the stock tests support levels.
About the Company
Camping World is headquartered in Lincolnshire, Illinois and employs over 10,000 people. The company was founded in 1966 and operates a network of 170 retail locations in 38 states. The company operates in two segments, Good Sam and Plans; and RV and Outdoor Retail.
CWH is valued at $3 billion and has a Forward PE of 6. The company holds a Zacks Style Score of “A” in Momentum, Growth and Value. The stock also pays a 2.7% dividend.
Travel Has Changed
COVID-19 brought a halt to travel at the height of the pandemic. Because the U.S. had one of the highest cases counts, many countries issued quarantine rules for American travelers. This wasn’t appealing for a vacation so we saw a surge in domestic travel here at home. Since all the hotels were closed, the demand for RV’s and the desire to camp increased.
While America has opened up, the demand for camping is still there as we head through the summer months. In April, the RV industry Association reported March shipments at 54.3k v 30.3k a year ago, up 47.9%. We saw proof of this momentum when RV marker Thor Industries reported earnings a few weeks ago and saw a massive order backlog.
Q1 Earnings Beat
Thor isn’t the only one having success, as both Winnebago and Camping World have all reported fantastic numbers last quarter. In fact, Camping World has beaten EPS expectations for five straight quarters.
Looking at the last quarter, the company reported in early May and saw a 159% EPS beat. Q1 came in at $1.40 v $0.54 expected, with revenues at $1.56B v $1.27B expected. The company also raised FY21 adj EBITDA to $770-810M and sees adjusted EBITDA at $189.3M v $36M year over year. Moreover, margins came in higher, up to 12.2% v 3.5% a year ago.
A few weeks after earnings, the company raised its quarterly dividend 8.7% to $0.25 from $0.23. This would give investors a yield of about 2.7% at the current stock price.
Camping World Holdings Inc. Price and EPS Surprise
Camping World Holdings Inc. price-eps-surprise | Camping World Holdings Inc. Quote
Estimates Rising
Over the last 60 days, estimates are rising over all time frames. For the current quarter, analysts have raised estimates from $1.54 to $2.23, a hike of 45%. For the current year, we see an 28% hike, from $4.31 to $5.54.
The Technical Take
The stock has a volatile track record, moving from $3 at the height of the pandemic to $48 just a few months ago. There has been selling as of late, with the stock falling over 25% off its highs.
We are now down to the 200-day Moving average, a support level that has seen three significant bounces since November of last year. This area could start a bounce, back to the 50-day MA at $42. However, if it fails, expect the stock to find the $30 level.
In Summary
Campers are big business and the pandemic created record demand. While we might get some normalization in future earnings, this summer should continue to stay hot for the manufacturers and Camping World.
Bulls finally are getting a good price to buy as the stock falls into technical support. Additionally, the dividend allows longer-term investors to get paid while they camp out in Camping World.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Download FREE: How to Profit from Trillions on Spending for Infrastructure >>