Why Is Thor Industries (THO) Up 7.5% Since Last Earnings Report?
It has been about a month since the last earnings report for Thor Industries (THO). Shares have added about 7.5% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Thor Industries due for a pullback? 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 Beats Q3 Earnings Estimates
Thorposted third-quarter fiscal 2022 adjusted earnings of $6.32 per share, which beat the Zacks Consensus Estimate of $4.97. This outperformance can be attributed to higher-than-anticipated revenues across North American Towable and Motorized RVs segments. The bottom line jumped 92% from the year-ago profit of $3.29 per share. The company registered revenues of $4,657.5 million for the quarter under review, topping the Zacks Consensus Estimate of $4,173 million. The top line also surged 34.6% year over year.
Segmental Results
North American Towable RVs: Revenues from the segment came in at $2,640.1 million, surging 53% 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 $2,263 million. Pretax profit totaled $326.7 million, up from $167.7 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 $6.9 billion, declining from $7.4 billion as of Apr 30, 2021.
North American Motorized RVs: Revenues from the segment totaled $1,053 million, which soared 35.8% year over year, thanks to higher unit sales and the Tiffin Group buyout benefits. The top line also outpaced the consensus mark of $986 million. Pretax profit came in at $116.3 million, up from $54.8 million recorded in the year-ago period. Backlog in the segment was $4.1 billion, up from $3.5 billion as of Apr 30, 2021.
European RVs: Revenues from the segment came in at $724 million, down 19% from the year-ago period. The top line also missed the consensus mark of $870 million. The segment incurred a pretax income of $20.6 million, lower than the year-ago level of $44 million. The backlog of the segment was $2.8 billion, reflecting a drop from $3.3 billion recorded on Apr 30, 2021.
Financials and Consolidated Backlog
As of Apr 30, 2022, Thor had cash and cash equivalents of $331.9 million and long-term debt of $1983.6 million. Consolidated backlog as of quarter-end was $13.88 billion, reflecting a year-over-year decline of 3%.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
The consensus estimate has shifted 11.21% due to these changes.
VGM Scores
At this time, 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 broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Thor Industries has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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