Latest news with #CWH
Yahoo
3 days ago
- Automotive
- Yahoo
Camping World Holdings, Inc. (CWH): A Bull Case Theory
We came across a bullish thesis on Camping World Holdings, Inc. on Stock Analysis Compilation's Substack. In this article, we will summarize the bulls' thesis on CWH. Camping World Holdings, Inc.'s share was trading at $18.08 as of July 14th. CWH's forward P/E was 25.84, respectively according to Yahoo Finance. Photo by Blake Wisz on Unsplash Camping World Holdings (CWH), the largest RV dealer in the U.S., is set to benefit from proposed legislation that would make RV mortgage interest and trailer floorplan financing fully tax deductible. This policy change could reduce monthly costs for RV buyers by approximately 10%, potentially reigniting demand in an industry that has been in decline since 2022. CWH, with a strong focus on affordable trailers, continues to gain market share in this domestically concentrated market—most RVs are manufactured in Elkhart, Indiana, giving the company minimal exposure to international tariffs. Despite these advantages, RV-related stocks, including CWH, experienced a sell-off in April. However, this pullback, coupled with the new legislative tailwind, has created an attractive entry point for investors. The firm behind the thesis has held a position in CWH since its inception based on its ability to consistently gain share and its compelling valuation, though the stock previously lacked a meaningful catalyst. The recent policy momentum provides that missing trigger. If enacted, the bill could significantly improve affordability for consumers and drive a rebound in RV purchases, positioning CWH as a clear winner given its scale and price-focused offerings. The investor has responded by increasing exposure to the stock, anticipating that the favorable legislative environment could accelerate share gains and unlock upside in a currently discounted equity. Overall, CWH offers an appealing risk/reward setup, with its dominant market position, renewed demand outlook, and supportive policy developments aligning to create a timely investment opportunity. Previously, we covered a on CarMax, Inc. by Stock Region in July 2025, which highlighted strong earnings, record unit profitability, and a large share buyback. The company's stock price has depreciated approximately 2.20% since our coverage due to macro headwinds. The thesis still stands as fundamentals remain solid. Stock Analysis Compilation shares a similar outlook on Camping World Holdings, emphasizing a legislative catalyst. Camping World Holdings, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 32 hedge fund portfolios held CWH at the end of the first quarter which was 36 in the previous quarter. While we acknowledge the potential of CWH as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock. Disclosure: None.
Yahoo
04-07-2025
- Business
- Yahoo
Here's How Camping World (CWH) Benefits from New Legislation
Night Watch Investment Management, an investment management firm, released its second-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the second quarter, the fund LP appreciated by 23.31% net of fees, and YTD, its performance stood at 20.71%. The portfolio demonstrated resilience in the quarter, despite volatility in March and April. In addition, please check the fund's top five holdings to know its best picks in 2025. In its second-quarter 2025 investor letter, Night Watch Investment Management highlighted stocks such as Camping World Holdings, Inc. (NYSE:CWH). Camping World Holdings, Inc. (NYSE:CWH) is a US-based retailer of recreational vehicles (RVs) and related products and services. The one-month return of Camping World Holdings, Inc. (NYSE:CWH) was 3.66%, and its shares gained 1.38% of their value over the last 52 weeks. On July 3, 2025, Camping World Holdings, Inc. (NYSE:CWH) stock closed at $18.42 per share, with a market capitalization of $1.153 billion. Night Watch Investment Management stated the following regarding Camping World Holdings, Inc. (NYSE:CWH) in its Q2 2025 investor letter: "A potential beneficiary of the new legislation is Camping World Holdings, Inc. (NYSE:CWH), the largest RV dealer in the U.S. With a focus on affordable trailers, CWH continues to gain share in a domestically concentrated industry that's been in decline since 2022. Despite limited exposure to tariffs – most RVs are built in Elkhart, Indiana – RV stocks sold off in April. The new bill proposes to make RV mortgage interest and trailer floorplan financing fully tax deductible, cutting monthly costs for customers by ~10%. We've owned CWH since inception for its share gains and valuation, but it lacked a catalyst. The recent dip, paired with this legislative tailwind, prompted us to add to the position." A well lit Airstream RV parked in the outdoors, highlighting the recreational vehicles offered by the company. Camping World Holdings, Inc. (NYSE:CWH) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 32 hedge fund portfolios held Camping World Holdings, Inc. (NYSE:CWH) at the end of the first quarter, which was 36 in the previous quarter. In the first quarter of 2025, Camping World Holdings, Inc. (NYSE:CWH) reported revenue of $1.4 billion, up 4% year-over-year. While we acknowledge the potential of Camping World Holdings, Inc. (NYSE:CWH) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains. In another article, we covered Camping World Holdings, Inc. (NYSE:CWH) and shared the list of top falling stocks with unusual volume. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. While we acknowledge the potential of CWH as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money. Disclosure: None. This article is originally published at Insider Monkey.
Yahoo
14-05-2025
- Business
- Yahoo
3 Reasons to Avoid CWH and 1 Stock to Buy Instead
Camping World has gotten torched over the last six months - since November 2024, its stock price has dropped 31.2% to $16.62 per share. This might have investors contemplating their next move. Is there a buying opportunity in Camping World, or does it present a risk to your portfolio? Check out our in-depth research report to see what our analysts have to say, it's free. Despite the more favorable entry price, we don't have much confidence in Camping World. Here are three reasons why CWH doesn't excite us and a stock we'd rather own. Same-store sales show the change in sales for a retailer's e-commerce platform and brick-and-mortar shops that have existed for at least a year. This is a key performance indicator because it measures organic growth. Camping World's demand has been shrinking over the last two years as its same-store sales have averaged 14.3% annual declines. Note that Camping World reports its same-store sales intermittently, so some data points are missing in the chart below. Analyzing the long-term change in earnings per share (EPS) shows whether a company's incremental sales were profitable – for example, revenue could be inflated through excessive spending on advertising and promotions. Camping World's full-year EPS turned negative over the last five years. In a mature sector such as consumer retail, we tend to steer our readers away from companies with falling EPS because it could imply changing secular trends and preferences. If the tide turns unexpectedly, Camping World's low margin of safety could leave its stock price susceptible to large downswings. As long-term investors, the risk we care about most is the permanent loss of capital, which can happen when a company goes bankrupt or raises money from a disadvantaged position. This is separate from short-term stock price volatility, something we are much less bothered by. Camping World burned through $7.76 million of cash over the last year, and its $2.48 billion of debt exceeds the $20.92 million of cash on its balance sheet. This is a deal breaker for us because indebted loss-making companies spell trouble. Unless the Camping World's fundamentals change quickly, it might find itself in a position where it must raise capital from investors to continue operating. Whether that would be favorable is unclear because dilution is a headwind for shareholder returns. We remain cautious of Camping World until it generates consistent free cash flow or any of its announced financing plans materialize on its balance sheet. Camping World isn't a terrible business, but it doesn't pass our bar. After the recent drawdown, the stock trades at 17.2× forward P/E (or $16.62 per share). This multiple tells us a lot of good news is priced in - you can find better investment opportunities elsewhere. Let us point you toward an all-weather company that owns household favorite Taco Bell. Donald Trump's victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs. While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
13-05-2025
- Business
- Yahoo
CWH Q1 Earnings Call: Management Focuses on Cost Actions and Used RV Momentum Amid Revenue Miss
Recreational vehicle (RV) and boat retailer Camping World (NYSE:CWH) fell short of the market's revenue expectations in Q1 CY2025 as sales rose 3.6% year on year to $1.41 billion. Its non-GAAP loss of $0.15 per share was 26.5% above analysts' consensus estimates. Is now the time to buy CWH? Find out in our full research report (it's free). Revenue: $1.41 billion vs analyst estimates of $1.43 billion (3.6% year-on-year growth, 1% miss) Adjusted EPS: -$0.15 vs analyst estimates of -$0.20 (26.5% beat) Adjusted EBITDA: $49.45 million vs analyst estimates of $28.03 million (3.5% margin, 76.4% beat) Operating Margin: 1.5%, up from 0.3% in the same quarter last year Free Cash Flow was -$256 million compared to -$93.91 million in the same quarter last year Locations: 209 at quarter end, down from 215 in the same quarter last year Market Capitalization: $1.03 billion Camping World's Q1 results reflected ongoing shifts in product mix and cost discipline as management aimed to balance volume growth and profitability. CEO Marcus Lemonis cited a 30% increase in used unit sales and emphasized targeted cost reductions, including headcount and dealership consolidations, to deliver improved operating margins. Leadership highlighted that these actions, initiated early in the year, are designed to offset continuing pressure on average selling prices (ASPs) and to capitalize on growth in the used RV segment, which outpaced expectations. Looking forward, Camping World's management expressed confidence in sustaining market share gains and improving cost efficiency, while remaining attentive to wider consumer trends and potential headwinds from tariffs and financing conditions. Lemonis stated, 'We remain confident in the guideposts we've laid out to deliver growth in excess of low double-digits in used units, low single-digits in new, vehicle gross margins within our historical range and SG&A as a percentage of gross profit improving 600 to 700 basis points.' The company remains focused on optimizing its business mix and cost structure to navigate an uncertain consumer environment. Camping World's leadership attributed Q1 performance to a combination of operational adjustments, inventory strategy, and evolving consumer behavior in the recreational vehicle (RV) sector. The following points highlight the key themes and tactical changes underpinning recent results: Used RV sales momentum: Management reported significant gains in used unit sales, supported by improved procurement and inventory velocity, which helped offset softness in new unit ASPs. They described record levels of used inventory procurement in March and April, fueling same-store sales gains. Cost reduction measures: The company took decisive steps to lower selling, general, and administrative (SG&A) expenses by approximately $35 million on an annualized basis, including workforce reductions and location consolidations. These actions aim to preserve margins amid ASP variability and are expected to show greater impact in the second half of the year. Market share expansion: Camping World achieved a combined new and used unit market share over 14% through February, exceeding prior targets. This was achieved through a focus on affordability and product offerings across a broad range of price points, as well as digital marketing initiatives. Minimal tariff impact expected: Management reiterated that direct tariff effects on the RV business are expected to be limited, as most RVs sold are domestically produced. Any increase in new unit prices is anticipated to benefit the used business by raising the value of existing inventory. Financing and affordability trends: Executives noted that credit availability and consumer affordability remain critical drivers, with average credit scores for buyers above 700 and lenders showing stable to slightly improved terms. The company continues to address affordability by offering a wide range of monthly payment options to suit diverse consumer budgets. Camping World's management is prioritizing margin improvement, used vehicle growth, and operational discipline to support future performance, while remaining attentive to evolving industry dynamics and consumer demand. SG&A cost control: Management expects further improvement in operating margins as ongoing cost reduction initiatives—including headcount reductions and dealership consolidation—take full effect throughout the year. Used vehicle growth focus: The company aims for double-digit growth in used unit sales, leveraging procurement capabilities and flexible sourcing to capitalize on increased consumer interest in pre-owned RVs. Industry pricing and tariffs: While direct tariff exposure is limited, anticipated price increases for model year 2026 RVs could impact the mix between new and used sales. Management believes contract manufacturing and product mix flexibility will help mitigate any demand shifts. Joseph Altobello (Raymond James): Asked about the drivers behind ASP softness and the level of OEM (original equipment manufacturer) promotional support. Management emphasized the impact of increased entry-level unit sales and stated new unit margins remained within historical ranges without heavy promotions. Sean Wagner (Citigroup): Inquired about potential tariff impacts and the durability of the balance sheet if macro conditions deteriorate. Executives stated they see limited direct tariff risk and highlighted available liquidity, asset sales, and ongoing deleveraging as key financial safeguards. Alex Perry (Bank of America): Questioned why Camping World's results diverged from softening consumer trends and how the company sustains used sales momentum. Management cited the installed base of RV users and tailored affordability options as differentiators. Michael Swartz (Truist Securities): Asked for details on the cadence and reinvestment of recent cost reduction actions. Management explained that most reductions are completed, with expected full benefit in the coming quarters, and signaled readiness for further cuts if necessary. Scott Stember (ROTH MKM): Sought clarity on the lending environment and customer demand in the parts and service segment. Management reported stable to improving retail lending conditions and increasing customer activity in service and campgrounds, especially as domestic travel remains popular. In the next few quarters, our analysts will be monitoring (1) the sustained momentum in used RV sales and whether new inventory procurement continues at record levels, (2) the effectiveness of SG&A reductions and dealership consolidation on margin improvement, and (3) potential shifts in consumer financing and affordability trends as broader economic conditions evolve. Execution on optimizing the business mix and managing tariff-related pricing changes will also be important markers of strategic progress. Camping World currently trades at a forward P/E ratio of 17.2×. In the wake of earnings, is it a buy or sell? Find out in our free research report. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
01-05-2025
- Automotive
- Yahoo
Camping World Holdings Inc (CWH) Q1 2025 Earnings Call Highlights: Strong Used Unit Sales and ...
Revenue: $1.4 billion, an increase of 4% year-over-year. Used Unit Sales: Increased by 30%. Used Vehicle Gross Margins: 18.6%, showing year-over-year improvement. Adjusted EBITDA: $31.1 million, compared to $8.2 million last year. SG&A Reduction: Eliminated approximately $35 million of annualized SG&A costs. Cash Position: Ended the quarter with about $179 million in cash. Store Openings: Opened 9 dealerships during the quarter. Market Share: Combined new and used unit market share over 14% through February. Real Estate Ownership: Own about $205 million of real estate without an associated mortgage. Warning! GuruFocus has detected 6 Warning Signs with CWH. Release Date: April 30, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Camping World Holdings Inc (NYSE:CWH) achieved a significant increase in used unit sales, driving a 4% revenue growth to $1.4 billion. The company reported a substantial improvement in used vehicle gross margins, reaching 18.6%, indicating effective inventory management. CWH successfully opened 9 new dealerships, including 5 Lazy Day locations, which were profitable in March. The company is strategically positioned to benefit from stabilizing forces in the used business, Good Sam business, and service and parts business. CWH has taken decisive actions to reduce SG&A costs, with a commitment to improve SG&A as a percentage of gross profit by 60 to 700 basis points. Average selling prices (ASPs) were softer than expected, partly due to a mix shift towards entry-level products. The company had to make difficult decisions, including layoffs and dealership consolidations, to optimize costs. There is ongoing pressure on ASPs, which could impact revenue and gross profit if not managed effectively. CWH is facing challenges in maintaining leverage targets, with a focus on deleveraging the balance sheet. The macroeconomic environment, including potential tariff impacts and consumer confidence, poses risks to future performance. Q: Marcus, regarding ASPs, you mentioned they were softer than expected. How much of that was promotion-driven, and how much support are you getting from OEM partners? A: Marcus Lemonis, CEO: Thor continues to support us in growing market share responsibly. We haven't needed to be overly promotional, and our margins remain in line with historical levels. Our ASP softness is due to focusing on selling more RVs and growing market share. We are managing costs proactively to offset potential ASP declines. Q: What drove the acceleration in new same-store sales in April compared to the first quarter? A: Matthew Wagner, EVP: The inclement weather in February affected sales, but March saw a 3% increase. April's high single-digit increase is due to easier comps and continued momentum. We remain confident in achieving low single-digit growth for the year. Q: How are you addressing potential tariff impacts on pricing and the RV industry? A: Marcus Lemonis, CEO: We don't anticipate significant price increases before the 2026 model year. Any increase will benefit our used business, as our inventory becomes more valuable. We are making strategic moves to mitigate potential impacts and maintain demand. Q: Can you provide assurance regarding financial leverage and balance sheet durability in case of an economic slowdown? A: Marcus Lemonis, CEO: We have a healthy balance sheet with cash, inventory, and real estate assets. We are focused on deleveraging and generating cash. Investors should feel confident in our ability to manage leverage and risk. Q: What is driving the strength in your business despite broader consumer confidence concerns? A: Marcus Lemonis, CEO: Our focus on the installed base of RVers and affordability helps us maintain strength. RVs offer a cost-effective vacation option, and our business benefits from consumers seeking value in uncertain times. Q: How are you managing cost reductions, and will these savings be reinvested or fall to the bottom line? A: Marcus Lemonis, CEO: We planned $22-23 million in reductions and added $12-13 million more due to ASP softness. These cuts are mostly complete and will benefit us throughout the year. We are prepared to make further cuts if necessary. Q: Are market consolidations accretive to the bottom line, and what is your M&A strategy for this year? A: Thomas Kirn, CFO: Consolidations are accretive as we maintain gross profit while reducing costs. We are opportunistic with M&A, focusing on building cash and deleveraging. We have one potential transaction for the back half of the year. Q: How do you view the long-term store count target of 325 locations? A: Marcus Lemonis, CEO: We aim to grow our footprint and see opportunities in new markets. While the exact number may vary, we are committed to growth and improving profitability. We have acquired 10 stores this year and continue to evaluate opportunities. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
