Recreational vehicle (RV) maker THOR Industries (NYSE: THO) stock has fallen nearly (-30%) off its 2021 highs despite recording monster earnings beats. The Company expects continued supply chain disruptions, cost pressures, and logistical challenges. While business was bolstered during the pandemic lockdowns as consumers took to outdoor recreational activities, the business has not seen a reversion with the reopenings. The Company has a record $18.07 billion of RV backlog since its last earnings report, which blew away topline and bottom-line consensus analyst estimates. The sell-off in shares is providing opportunistic pullbacks for prudent investors seeking exposure in this leader of both recreational RV and mobile work play, which shows no slowing down despite the expectancy of rising interest rates in 2022.
Q1 Fiscal 2022 Earnings Release
On Dec. 8, 2021, Thor released its fiscal first-quarter 2022 results for the quarter ending October 2021. The Company reported a profit of $4.34 per share to blow out consensus analyst estimates for $3.19 per share by $1.15 per share. Revenues rose 56% year-over-year (YoY) to $3.96 billion beating consensus analyst estimates for $3.46 billion. The consolidated RV backlog was $18.07 billion as of Oct. 31, 2021, up over 100% YoY.
THOR Industries CEO Bob Martin commented, “Our first-quarter financial and operational performance was a phenomenal start to our fiscal 2022 year. As we look ahead, we expect continued supply chain constraints, logistical challenges, and cost pressures. However, as we have consistently demonstrated, we also expect to continue to excel at our top and bottom lines. We remain steadfastly focused on the execution of our strategic plan while we continue our realization of operational excellence as we strive to meet the strong consumer demand for our products. Through continued strategic operational execution, the integration of our recent acquisitions, our positive outlook for the RV industry and with record backlog levels providing visibility beyond this fiscal year, we are confident that fiscal year 2022 will be another year of meaningful growth for THOR.” He continued, “Additionally, RVIA has recently increased its wholesale shipment forecast for the calendar year 2021 to more than 602,000 units, and to over 613,000 for the calendar year 2022, a projected increase of approximately 2% for next year. We agree with this outlook and expect THOR to continue to outperform the market and to grow at a higher rate than RVIA projects for the industry as a whole. Building on our record-setting fiscal 2021, THOR delivered yet another quarter of strong financial results to begin our 2022 fiscal year. It seems the market focuses on the supply chain and labor challenges that our industry is facing right now more than it does our performance in the face of those challenges, but our performance has been consistent despite those challenges. Through outstanding operational execution, our teams continue to successfully navigate through these challenges at record levels. In the quarter, we delivered over 88,100 units, outpacing the RV industry’s growth rate of shipments. Our first-quarter performance, which marks a third consecutive quarter of record net sales and diluted earnings per share, is a testament to the experience, flexibility, and agility of our operating teams and their drive to meet the needs of our customers in a difficult and dynamic business environment. Independent dealer sentiment remains positive and consumer demand for our RV products remains strong. In the first quarter, our global order backlog increased to more than $18 billion, reaffirming our view that the dealer restocking process will still take a number of quarters to complete and could possibly extend into calendar 2023.”
He concluded, “The strategic course we have set gives us many reasons to remain confident and optimistic about our future performance as well. Our acquisition of Airxcel in the first quarter is a manifestation of our bullish outlook for our industry and for THOR in particular. This acquisition is a key piece to our strategic positioning of the Company as we seek to strengthen our supply chain. The Airxcel integration has gone exceedingly well, and we continue to see a great opportunity for growth through innovation, additional product offerings and the aftermarket business.” On Jan. 6, 2022, Thor director Andrew Graves purchased $210,000 worth of THO shares in the open market (approximately 2,000 shares).
THO Opportunistic Price Levels
Using the rifle charts on the weekly and daily time frames provides a broader view of the landscape for THO stock. The weekly rifle chart abruptly reversed after peaking at the $128.87 Fibonacci (fib) level. The weekly rifle chart formed an inverse pup breakdown with a falling 5-period moving average (MA) flattening at $102.08 followed by the weekly 15-period MA at $108.33. The weekly stochastic is attempting to coil at the 20-band. The weekly market structure low (MSL) buy triggers a breakout through $105.55. The daily rifle chart uptrend has a rising 5-period MA at $104.78 followed by the 15-period MA at $101.61. The daily stochastic is riding the 85-band. The daily upper Bollinger Bands (BBs) sit at $104.78. Prudent investors can watch for opportunistic pullbacks at the $99.94 fib, $98.09 fib, $96.40 fib, $93.11 fib, $91.39 fib, $87.62 fib, and the $83.38 fib level. Upside trajectories range from the $116.49 fib level up to the $137.92 fib level.
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