uploads/2016/07/tho-pm-2.png

Sun Trust Upgrades Thor Industries to a ‘Buy’

By

Updated

Price movement

Thor Industries (THO) has a market capitalization of $4.0 billion. It rose by 1.9% to close at $76.54 per share on July 29, 2016.

The stock’s weekly, monthly, and year-to-date (or YTD) price movements were 3.3%, 20.4%, and 37.6%, respectively, on the same day. THO is trading 5.9% above its 20-day moving average, 13.3% above its 50-day moving average, and 29.2% above its 200-day moving average.

Article continues below advertisement

Related ETFs and peers

The iShares Morningstar Small Core ETF (JKJ) invests 0.57% of its holdings in Thor Industries. The ETF tracks a market cap–weighted index of US small-cap core stocks. The index selects stocks from 90%–97% of market capitalizations falling under Morningstar’s core style categorization. The YTD price movement of JKJ was 12.0% on July 29.

The Vanguard Small-Cap Value ETF (VBR) invests 0.17% of its holdings in Thor Industries. The ETF aims to track the CRSP US Small-Cap Value Index. The index selects from a list of stocks in the 85%–99% range of market capitalization based on five value factors.

The market capitalizations of Thor Industries’ competitors are as follows:

  • Berkshire Hathaway (BRK.A) — $354.2 billion
  • Drew Industries (DW) — $2.2 billion

Thor Industries’ rating

Sun Trust Robinson Humphrey has upgraded Thor Industries’ rating to a “buy” from a “neutral.” It has also raised the stock’s price target to $90 from $65 per share.

Article continues below advertisement

Thor Industries’ performance in fiscal 3Q16

Thor Industries reported fiscal 3Q16 net sales of $1.3 billion, a rise of 8.3% compared to net sales of $1.2 billion in fiscal 3Q15. Sales of its towable recreational vehicles (RV) and motorized RVs rose by 1.7% and 20.7%, respectively, in fiscal 3Q16 compared to fiscal 3Q15.

The company’s gross profit margin and income from continuing operations before income taxes rose by 10.6% and 22.9%, respectively, in fiscal 3Q16 compared to fiscal 3Q15.

Its net income and EPS (earnings per share) rose to $78.6 million and $1.49, respectively, in fiscal 3Q16 compared to $62.8 million and $1.17, respectively, in fiscal 3Q15.

Thor Industries’ cash and cash equivalents and inventories rose by 34.8% and 11.9%, respectively, in fiscal 3Q16 compared to fiscal 3Q15. Its current ratio and debt-to-equity ratio rose to 2.2x and 0.42x, respectively, compared to 2.1x and 0.41x, respectively, in fiscal 3Q15. It reported consolidated RV backlogs of $1.1 billion in fiscal 3Q16, a rise of 51.3% compared to fiscal 3Q15.

Now we’ll take a look at OshKosh Corporation (OSK).

Advertisement

More From Market Realist