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Founded in 1980, Thor Industries (NYSE: (THO - Free Report) – Free Report) is one of the world’s largest manufacturers of recreational vehicles (RVs). They IPO’d in 1984, and have grown both organically and through strategic acquisitions since then.
The company operates through 1) Towable Recreational Vehicles, 2) Motorized Recreational Vehicles, and 3) Other, segments.
Impressive Results
The company reported its Q4 fiscal 2017 results on September 27. Adjusted earnings of $2.26 per share were significantly better than the Zacks Consensus Estimate of $1.95 and up 44% year-over-year.
Results were boosted by strong organic growth and the acquisition of Jayco in June last year.
"Thor completed another year of exceptional growth, supported by strong demand from dealers and consumers for our products, notably our expanded lines of more affordably-priced towable and motorized RVs,” said the CEO.
The company has an impressive record of profitability. They have grown their earnings consistently, with a 5-year CAGR of 22.4% for net sales and 27.9% for diluted EPS.
Rising Earnings Estimates
Analysts have raised their estimates for the company after excellent earnings. The Zacks Consensus Estimate for the current and the next fiscal year have increased to $8.14 per share and $8.83 per share from $7.60 and $8.78, seven days ago.
Headquartered in El Segundo, CA, Mattel (Nasdaq: (MAT - Free Report) – Free Report) is one of the world’s largest manufacturer of toys. Their portfolio includes Barbie, Hot Wheels, Monster High, American Girl, Thomas & Friends and Fisher-Price brands. They employ approximately 32,000 people in 40 countries and sell products in more than 150 countries.
Weak Results Lead to Falling Estimates
Mattel’s adjusted loss of 14 cents per share was worse than the Zacks Consensus Estimate of a loss of 8 cents. Revenues also missed our estimate.
Estimates have also plunged after the report. Zacks Consensus Estimates for the current and the next year have fallen to $0.65 per share and $0.82 per share from $0.95 and $ 1.16 respectively before the results.
The company has missed in three out of last four quarters and just met in one, with an average negative quarterly surprise exceeding 47%.
Shares fell after the report and are now down over 46% year-to-date. In June, the company announced that it is slashing its quarterly dividend to $0.15 per share from $0.38 per share earlier.
Additional content:
Tesla Stock Pops Again, but Should Investors Hit the Breaks?
Tesla (Nasdaq: (TSLA - Free Report) – Free Report) stock surged after a new analyst upgrade on Wednesday, despite the electric car company’s recent failure to meet production goals for its Model 3 sedan.
In a note to clients, Nomura Instinet analyst Romit Shah initiated Tesla coverage with a “Buy” rating. On top of that, the analyst set a $500 per share 12-month price target, which would represent a 44% jump from Tesla’s Tuesday close.
The Nomura analyst also proclaimed that Tesla could be poised to dominate the electric car industry in a manner akin to Intel’s (Nasdaq: INTC – Free Report) PC run in the 1990s.
"Tesla is vertically integrated, owning both the manufacturing and much of the supply chain, similar to Intel when it scaled revenues from $4bn to $34bn during the 1990s' PC era," Shah wrote in a note to clients. "We believe that Tesla has an insurmountable lead in vehicle range per dollar; benefits from what we believe is a largely inferior competitive field, which should help sustain current growth."
Shah also said that Tesla's Gigafactory allows Elon Musk’s company to manufacture batteries more efficiently than its competitors. Tesla’s less-expensive Model 3 costs $140 per mile of range, which tops other electric carmakers’ $236 per mile of range, according to Shah (also read: So, What Actually Is Tesla's Gigafactory?).
Based on these advantages, Shah expects that Tesla’s revenues will climb to $58 billion in 2021, up from $7.75 billion in 2016. The analyst projects this sales growth will be spurred by a jump in total vehicle sales, from an estimated 112,000 this year to 877,000 by 2021.
This eye-popping projection helped send Tesla stock up almost 3% to hit $358.62 per share on Wednesday morning.
Yet investors don’t seem to care that the company isn’t coming close to meeting its own production expectations at the moment.
Tesla recently reported that it built just 260 Model 3 sedans between July and September. The electric car giant announced as recently as August that it would produce 1,500 of its newest vehicles during that time frame.
This might make some investors ask: how could Tesla be so wrong? Or maybe worse yet, what is causing the delays?
However, the basic thought of many investors is that Tesla’s current fundamentals don’t matter. Investors view Musk and his company as a long-term, game-changing play. Furthermore, at least one analyst has noted that failing to meet production goals is much better than rushing out new EVs that are not up to snuff.
“It’s the lesser of two evils,” senior Consumer Edge Research analyst Jamie Albertine told Bloomberg recently. “Do you risk investor sentiment and hurt the stock price today or disappoint customers with a recall tomorrow? A recall on the Model 3 could be catastrophic.”
Tesla is currently a Zacks Rank # 3 (Hold) and scored and “F” for both Value and Growth in our Style Score system and it is set to see its EPS figures plummet 128.53% this year, based on our current consensus estimates. This does not seem to matter for many investors, as Tesla hasn’t been treated like a regular car company, really ever.
Can Hackers Put Money INTO Your Portfolio?
Earlier this month, credit bureau Equifax announced a massive data breach affecting 2 out of every 3 Americans. The cybersecurity industry is expanding quickly in response to this and similar events. But some stocks are better investments than others.
Zacks has just released Cybersecurity! An Investor’s Guide to help Zacks.com readers make the most of the $170 billion per year investment opportunity created by hackers and other threats. It reveals 4 stocks worth looking into right away. Download the new report now>>
About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
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Thor Industries, Mattel, Tesla and Intel highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – October 5, 2017 – Zacks Equity Research Thor Industries (NYSE: (THO - Free Report) – Free Report) as the Bull of the Day, Mattel (Nasdaq: (MAT - Free Report) – Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Tesla (Nasdaq: (TSLA - Free Report) – Free Report) and Intel (Nasdaq: (INTC - Free Report) – Free Report).
Here is a synopsis of all four stocks:
Bull of the Day:
Founded in 1980, Thor Industries (NYSE: (THO - Free Report) – Free Report) is one of the world’s largest manufacturers of recreational vehicles (RVs). They IPO’d in 1984, and have grown both organically and through strategic acquisitions since then.
The company operates through 1) Towable Recreational Vehicles, 2) Motorized Recreational Vehicles, and 3) Other, segments.
Impressive Results
The company reported its Q4 fiscal 2017 results on September 27. Adjusted earnings of $2.26 per share were significantly better than the Zacks Consensus Estimate of $1.95 and up 44% year-over-year.
Results were boosted by strong organic growth and the acquisition of Jayco in June last year.
"Thor completed another year of exceptional growth, supported by strong demand from dealers and consumers for our products, notably our expanded lines of more affordably-priced towable and motorized RVs,” said the CEO.
The company has an impressive record of profitability. They have grown their earnings consistently, with a 5-year CAGR of 22.4% for net sales and 27.9% for diluted EPS.
Rising Earnings Estimates
Analysts have raised their estimates for the company after excellent earnings. The Zacks Consensus Estimate for the current and the next fiscal year have increased to $8.14 per share and $8.83 per share from $7.60 and $8.78, seven days ago.
Bear of the Day:
Headquartered in El Segundo, CA, Mattel (Nasdaq: (MAT - Free Report) – Free Report) is one of the world’s largest manufacturer of toys. Their portfolio includes Barbie, Hot Wheels, Monster High, American Girl, Thomas & Friends and Fisher-Price brands. They employ approximately 32,000 people in 40 countries and sell products in more than 150 countries.
Weak Results Lead to Falling Estimates
Mattel’s adjusted loss of 14 cents per share was worse than the Zacks Consensus Estimate of a loss of 8 cents. Revenues also missed our estimate.
Estimates have also plunged after the report. Zacks Consensus Estimates for the current and the next year have fallen to $0.65 per share and $0.82 per share from $0.95 and $ 1.16 respectively before the results.
The company has missed in three out of last four quarters and just met in one, with an average negative quarterly surprise exceeding 47%.
Shares fell after the report and are now down over 46% year-to-date. In June, the company announced that it is slashing its quarterly dividend to $0.15 per share from $0.38 per share earlier.
Additional content:
Tesla Stock Pops Again, but Should Investors Hit the Breaks?
Tesla (Nasdaq: (TSLA - Free Report) – Free Report) stock surged after a new analyst upgrade on Wednesday, despite the electric car company’s recent failure to meet production goals for its Model 3 sedan.
In a note to clients, Nomura Instinet analyst Romit Shah initiated Tesla coverage with a “Buy” rating. On top of that, the analyst set a $500 per share 12-month price target, which would represent a 44% jump from Tesla’s Tuesday close.
The Nomura analyst also proclaimed that Tesla could be poised to dominate the electric car industry in a manner akin to Intel’s (Nasdaq: INTC – Free Report) PC run in the 1990s.
"Tesla is vertically integrated, owning both the manufacturing and much of the supply chain, similar to Intel when it scaled revenues from $4bn to $34bn during the 1990s' PC era," Shah wrote in a note to clients. "We believe that Tesla has an insurmountable lead in vehicle range per dollar; benefits from what we believe is a largely inferior competitive field, which should help sustain current growth."
Shah also said that Tesla's Gigafactory allows Elon Musk’s company to manufacture batteries more efficiently than its competitors. Tesla’s less-expensive Model 3 costs $140 per mile of range, which tops other electric carmakers’ $236 per mile of range, according to Shah (also read: So, What Actually Is Tesla's Gigafactory?).
Based on these advantages, Shah expects that Tesla’s revenues will climb to $58 billion in 2021, up from $7.75 billion in 2016. The analyst projects this sales growth will be spurred by a jump in total vehicle sales, from an estimated 112,000 this year to 877,000 by 2021.
This eye-popping projection helped send Tesla stock up almost 3% to hit $358.62 per share on Wednesday morning.
Yet investors don’t seem to care that the company isn’t coming close to meeting its own production expectations at the moment.
Tesla recently reported that it built just 260 Model 3 sedans between July and September. The electric car giant announced as recently as August that it would produce 1,500 of its newest vehicles during that time frame.
This might make some investors ask: how could Tesla be so wrong? Or maybe worse yet, what is causing the delays?
However, the basic thought of many investors is that Tesla’s current fundamentals don’t matter. Investors view Musk and his company as a long-term, game-changing play. Furthermore, at least one analyst has noted that failing to meet production goals is much better than rushing out new EVs that are not up to snuff.
“It’s the lesser of two evils,” senior Consumer Edge Research analyst Jamie Albertine told Bloomberg recently. “Do you risk investor sentiment and hurt the stock price today or disappoint customers with a recall tomorrow? A recall on the Model 3 could be catastrophic.”
Tesla is currently a Zacks Rank # 3 (Hold) and scored and “F” for both Value and Growth in our Style Score system and it is set to see its EPS figures plummet 128.53% this year, based on our current consensus estimates. This does not seem to matter for many investors, as Tesla hasn’t been treated like a regular car company, really ever.
Can Hackers Put Money INTO Your Portfolio?
Earlier this month, credit bureau Equifax announced a massive data breach affecting 2 out of every 3 Americans. The cybersecurity industry is expanding quickly in response to this and similar events. But some stocks are better investments than others.
Zacks has just released Cybersecurity! An Investor’s Guide to help Zacks.com readers make the most of the $170 billion per year investment opportunity created by hackers and other threats. It reveals 4 stocks worth looking into right away. Download the new report now>>
About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
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Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.