Bear of the Day: Camping World (CWH) – February 1, 2023


Camping World (CWH Free Report) is a major provider of equipment and services for the recreational vehicle, or RV, market.

The company saw terrific sales growth to $6.9 billion in 2021 after mom & dad “hit the road” during the pandemic shutdown.

In 2022, sales leveled off with growth to just $6.96 billion, according to the current analyst consensus.

And EPS plummeted 36% from $6.88 to $4.39 from ’21 to ’22. What has put CWH back in the cellar of the Zacks Rank is that this year’s earnings projections call for a 32% drop to $2.98.

Investors Camped Above $35 in 2021

CWH shares saw big accumulation in 2021 between $32 and $42, with the 50-week moving average rising above $35 by the end of the year.

But the “on the road again” party was not to last. In early December, my colleague Jeremy Mullin described the “break up” story this way…

The stock has had a rough 2022, down about 40% on the year. On top of market weakness, the stock has reported some earnings misses that have brought pressure in the name.

And now the stock is starting to trend lower as earnings estimates fall. Investors should be cautions as the stock zeros in on 2022 lows.

Since Jeremy wrote that, CWH has dropped and just kissed support above $20 and its 2022 lows.

The Camping World Story

I actually love this company, not least because the CEO Marcus Lemonis is a grizzly bear of entrepreneurship.

They actually acquired some of my favorite “outdoor stores” in Wisconsin from the brand Gander Mountain.

Camping World, headquartered in Lincolnshire, IL, was founded in 1966 and employs over 12,000 people.

Camping World operates in two segments, Good Sam Services and Plans; and RV and Outdoor Retail. The company operated through a network of approximately 187 retail locations in 40 states of the United States. It serves customers through dealerships, and online and e-commerce platforms.

Lemonis jumped in last summer and bought $1 million worth of CWH shares around $26. He now owns at least 45% of the company.

As my colleague Tracey Ryniec — leader of the Insider Trader Portfolio — would say, that’s a big “confidence buy.”

Q3 Earnings Details

The company reported EPS in early November, reporting a 16% EPS miss. This was their second earnings miss in just three quarters and the stock is trading about 15% lower since the earnings release.

Q3 came in at $1.07 v the $1.27 expected. Revenues slightly beat expectations, coming in at $1.86B v the $1.82B expected. EBITDA margins came in at 9.3% v the 15% a year ago and was down from 12.8% last quarter.

Same store revenues were down 4.8% year over year.

CWH is expected to report their Q4 in late February.


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