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Why Is Thor Industries (THO) Down 20.2% Since Last Earnings Report?

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A month has gone by since the last earnings report for Thor Industries (THO - Free Report) . Shares have lost about 20.2% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Thor Industries due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Thor Puts Up A Stellar Q4 Show

Thor posted adjusted earnings of $4.12 per share, which beat the Zacks Consensus Estimate of $2.91. This outperformance can be attributed to higher-than-anticipated revenues across all its segments. The bottom line jumped 92.5% from the year-ago profit of $2.14 per share. The company registered revenues of $3,593 million for the quarter under review, topping the Zacks Consensus Estimate of $3,274 million. The top line recorded a 54.6% year-over-year increase.

As of Jul 31, 2021, Thor had cash and cash equivalents of $448.7 million, and long-term debt of $1,594.8 million. Consolidated backlog as of quarter-end was $16.86 billion, reflecting a meteoric year-over-year rise of 190%.

Segmental Results

North American Towable RVsRevenues from the segment came in at $1,730.6 million, surging 46.4% year over year on the back of robust shipments and benefits from the Tiffin Group buyout. The top line also surpassed the Zacks Consensus Estimate of $1,665 million. Pretax profit totaled $202.2 million, up from $129.2 million recorded in the year-ago period, thanks to higher sales and improved gross profit margins. At quarter-end, the unit’s total backlog was $9.28 billion, skyrocketing from $2.76 billion as of Jul 31, 2020.

North American Motorized RVsRevenues from the segment totaled $823.1 million, which skyrocketed 124.6% year over year, thanks to higher unit sales and the Tiffin Group buyout benefits. The top line also outpaced the consensus mark of $735 million. Pretax profit came in at $62.3 million, up from $24.3 million recorded in the year-ago period. Backlog in the segment summed $4.01 billion, jumping from $1.45 billion as of Jul 31, 2020.

European RVs: Revenues from the segment came in at $969.8 million, up 31.1% from the year-ago period driven by higher unit shipments and a favorable product mix. The top line also beat the consensus mark of $869 million. The segment generated a net profit of $67.8 million, surging 138.8% year over year. Backlog of the segment was $3.56 billion, reflecting massive growth from $1.53 billion recorded on Jul 31, 2020.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended upward during the past month. The consensus estimate has shifted 31.18% due to these changes.

VGM Scores

Currently, Thor Industries has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Thor Industries has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.


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