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On Wednesday, Citi analysts maintained a Neutral rating and a $74.00 price target on Thor Industries Inc. (NYSE: NYSE:THO) stock, though InvestingPro analysis suggests the stock is currently undervalued. This decision follows Thor Industries’ report of a third-quarter fiscal 2025 loss per share of $2.53, which exceeded both Citi’s estimate of $1.52 and the consensus estimate of $1.78.
The company’s adjusted EBITDA reached $255 million, surpassing the Street’s expectation of $211 million and Citi’s projection of $195 million. This figure also exceeded last year’s adjusted EBITDA of $236 million. The company maintains a healthy financial position with a current ratio of 1.71 and moderate debt levels. Key factors contributing to this earnings performance included unit growth, average selling prices, and gross margin, all of which surpassed estimates.
Despite these positive results, Thor Industries’ management has decided to maintain its fiscal year 2025 guidance. This decision suggests that the company anticipates a more challenging fourth quarter than previously expected.
Citi analysts noted that higher inventory levels might be a concern for investors. However, the management of Thor Industries described the increase in inventory as a strategic move, emphasizing its importance in regaining market share.
In other recent news, Thor Industries has announced a regular quarterly cash dividend of $0.50 per share, payable on April 22, 2025, to shareholders on record as of April 8, 2025. Stifel analysts have revised their fiscal third-quarter sales projections for Thor Industries to $2.63 billion, up from the previous estimate of $2.44 billion, with earnings per share (EPS) expectations increased to $1.73 from $1.41. However, Citi analysts downgraded Thor Industries from Buy to Neutral, reducing the price target to $86 due to solid but not exceptional retail unit trends in the RV industry. KeyBanc Capital Markets also adjusted its price target for Thor Industries to $65, up from $60, while maintaining an Underweight rating, citing higher fiscal year 2025 estimates but expressing caution over the stock’s valuation.
In a strategic move, Thor Industries announced the integration of Heartland Recreational Vehicles under the Jayco brand, aiming to enhance operational efficiencies and streamline business processes. Benchmark analyst Michael Albanese maintained a Hold rating on Thor Industries, noting anticipated $350 million in unlevered free cash flow for fiscal year 2025, despite uncertainties in the European market and pressures in the Motorized segment. The restructuring is expected to yield strategic benefits such as improved synergies, reduced operating costs, and enhanced customer service capabilities. Analysts suggest that Thor Industries may face challenges in maintaining its market share and profit margins, with Citi expressing caution over the company’s ability to gain market share amidst persistent share losses.
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