Winnebago Beats the Street, But Share Climb Runs out of Gas

Andrew Klips |

Shares of luxury recreational vehicle maker Winnebago Industries Inc. (WGO) have been chugging upward, rising in each of the past five months and 12 out of the last 16 to notch gains of about 225 percent, but ran out of gas on Thursday despite driving over analyst predictions for the second quarter.

The Forest City, Iowa-based company reported fiscal second-quarter-2013 revenue of $177.2 million, a 34.6 percent climb from $131.6 million in the second quarter of fiscal 2012. Net income for the quarter totaled $6.3 million, or 22 cents per share, compared to a net loss of $912,000, or 3 cents per share, during the year prior quarter.

The earnings crushed Wall Street expectations of 14 cents per share on revenue of $171 million.

Earnings benefited from increased demand as total motorhome deliveries rose to 1,419 units from 1.001 in the year prior quarter. Total towable units, which include travel trailers and fifth-wheels, were down slightly to 548 from 562. Gross margins during the quarter expanded to 9.7 percent compared to only 5.2 percent last year.

Winnebago’s unaudited backlog of motorhomes swelled to 2,752 at the end of the latest second quarter, versus 1.004 in the year earlier quarter.

“We had very positive comparisons this year versus the first half of Fiscal 2012…Our motorhome sales growth continues to out-pace the industry, ” said Randy Potts, chairman, president and chief executive at Winnebago. He added that improved economic indicators should create a positive environment going forward and that he believes the motorized RV industry will continue to rise toward pre-recession levels.

Data from the Commerce Department on Tuesday showed that new orders for durable goods, those items meant to last more than three years, rose 5.7 percent in February, marking the fifth rise in the past six months.

On March 5, the Recreational Vehicle Industry Association said that RV shipments rose 13.3 percent in 2012 from 2011 with a total of 285,749 units shipped during the year, marking the highest total since 2007. For 2013, RVIA estimates that shipments will climb another 7.5 percent to 307,300 units. In January, 24,379 units were shipped by manufacturers, up more than 30 percent from January 2012.

On Tuesday, shares of WGO hit $22.34, their highest level since March 2008. Shares are up more than 20 percent in 2013. All was not bullful bliss with the earnings beat, however, as such is the fickle nature of the market. Shares fell 5.6 percent on Thursday to wrap the day at $20.64.

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Companies

Symbol Name Price Change % Volume
SPNC The Spectranetics Corporation 24.65 0.47 1.94 278,626
WGO Winnebago Industries Inc. 23.44 0.25 1.08 135,611

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