BMO Capital has maintained its Outperform rating on Thor Industries Inc. (NYSE: NYSE:THO) with a consistent price target of $120.00.
The firm's analysis followed the release of Thor's fourth fiscal quarter results for 2024, which exceeded expectations, albeit with a boost from several one-time items. Despite the positive results, Thor's guidance for fiscal year 2025 fell short of BMO Capital's projections, as well as the general consensus and what most investors likely anticipated.
Thor Industries reported earnings that outperformed forecasts, which prompted a detailed response from the firm. The company's forward-looking guidance, however, prompted BMO Capital to adjust its own financial projections to align with Thor's newly issued expectations.
This adjustment takes into account the current conditions in the recreational vehicle (RV) market, as observed during ongoing checks at the RV Open House event. These checks have signaled a tempered approach to dealer ordering, which could influence Thor's performance.
The firm highlighted that Thor Industries is proactively managing market expectations by setting more conservative guidance and ensuring that the dealer channel is not oversupplied. This strategy is seen as a positive step by Thor to address the potential ongoing share pressure and the anticipated retail demand in the calendar year 2025. By taking these measures, Thor aims to mitigate risks associated with inventory and demand fluctuations.
Thor's latest financial guidance, which is more conservative than previous estimates, has led to a recalibration of expectations among analysts and investors alike. BMO Capital's revised estimates are now in sync with Thor's outlook, reflecting a cautious stance on the company's future performance in the RV industry.
In other recent news, Thor Industries has experienced some noteworthy developments. BMO Capital maintained its Outperform rating on Thor Industries, holding its stock target at $120.00, despite revising its forecasts for the company's fourth quarter 2024, as well as for fiscal years 2025 and 2026. This adjustment was due to anticipated subdued dealer ordering and OEM production rates.
Despite this, the firm noted positive consumer interest at the Hershey RV show, indicating a robust demand. However, Thor Industries also had to adjust its full-year forecast, citing potential weakness extending into 2025.
This comes in light of a general downturn in the recreational vehicle industry, with major players like Brunswick (NYSE:BC) Corporation and Polaris (NYSE:PII) Inc. adjusting their annual forecasts due to declining profits.
Benchmark initiated coverage on Thor Industries with a Hold rating, estimating the company's enterprise value at approximately $5.2 billion. The company maintains a revised full-year 2024 guidance, expecting consolidated net sales to range between $10.0 billion and $10.5 billion.
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