Thor Industries announced record high revenue and higher than expected earnings for its third-quarter Wednesday. THO's strong financial report comes after Rev Group fell short of Wall Street expectations Tuesday.
Both Thor Industries and Rev Group reported that demand has remained high, a signal that consumers are still purchasing RVs even as the price of gas continues to increase. U.S. gasoline prices on Wednesday were on average $4.96 per gallon, a 61% increase from a year ago, according to the AAA gas price tracker.
Brookfield, Wis.-based Rev Group manufactures ambulances, buses, firefighting vehicles, recreational vehicles and other specialty vehicles. REVG owns brands that include American Coach, Fleetwood RV, Holiday Rambler, Renegade RV and Lance.
Competitor Thor, which has its headquarters Elkhart, Ind., sells both towable and motorhome-type RVs through its Airstream, Heartland RV, Jayco, and Livin Lite RV brand names.
RV sales have been on a decade long upward trend, but the coronavirus pandemic supercharged consumer interest. Americans, cautious of traveling in airplanes, packed into RVs and motor homes.
More than two years on, that interest has not abated.
There were a total of 57,043 RV shipments in April 2022, an increase of 11.5% compared to 51,813 units shipped during April 2021, according to the most recent numbers from the RV Industry Association.
Thor Industries Earnings
Estimates: Wall Street predicted Thor would earn around $4.77 per share. Revenue was seen coming in at $4.2 billion.
Results: THO earnings per share ballooned 92% vs a year earlier to $6.32. Revenue increased 34.6% to $4.66 billion.
Outlook: Thor expects retail demand for RVs to remain strong throughout the remainder of fiscal year 2022. Supply continues to be an issue due to a global chassis shortage and THO reports inventory will remain below normal levels until early in calendar year 2023.
"Our teams have done an exceptional job navigating continued supply chain and labor constraints while still fulfilling ongoing dealer and consumer demand for our products," CEO Bob Martin said in a news release.
"We remain disciplined in aligning production to meet current demand without overproducing and overloading our independent dealer channel," Martin added.
Thor Stock
THO stock was up 1% to 76.97 in Wednesday's market trading. It jumped 3.5% to 76.95 during Monday's market trading. THO stock has dropped considerably since peaking early in 2019, and is down almost 25% since the start of the year. It logged tight closes in April and May, and has now gained a fraction from its end-of-April close.
Thor Industries has a 55 Composite Rating. It's Relative Strength Rating is 22, according to IBD Stock Checkup.
Rev Group Earnings
Estimates: Analysts expect Rev Group to earn around $0.23 per share. Revenue is predicted to come in at $595.6 million. In its first quarter, REVG reported $0.13 earnings per share and revenue of $537 million. Its full fiscal year 2022 guidance was $2.3-$2.55 billion.
Results: REVG announced $0.17 earnings per share, a 57.5% decrease. The company also reported a 10.4% decrease in sales with $576.3 million. Backlog and demand remained strong, the company said, but "second quarter results reflect continuing shortages of key components and lower chassis supply that limited new starts, throughput, and completions," according to a statement.
CEO Rod Rushing said on the Tuesday earnings call that the company has suffered from supply chain issues and lingering labor challenges. This has restricted the availability of key components such as wiring harnesses, radiators and axles.
Rushing also said that the Q2 revenue decrease was driven by lower sales within its fire & emergency and commercial vehicle segment.
"Second-quarter results reflect continued strong order demand and execution in a challenging supply chain environment that has impacted industrials for the past three quarters," Rushing said.
CFO Mark Skonieczny also told investors Tuesday that REVG placed 100 employees on 30-day furloughs at the end of the second-quarter. The decision was made in response to parts shortages and supply chain constraints, according to Skonieczny.
Rev Group Stock
Rev Group stock jumped 14% to 11.59 Wednesday. It had slumped 16.4% in stock market trading Tuesday. On Monday, shares rose 1% to 12.17.
REVG has a Composite Rating of 27 and a 26 Relative Strength Rating, per IBD Stock Checkup.
Please follow Kit Norton on Twitter @KitNorton for more coverage.
