On Monday (NASDAQ:MNDY), KeyBanc Capital Markets maintained its Overweight rating on shares of Camping World Holdings (NYSE:NYSE:CWH), with a constant price target of $27.00. Following a recent management meeting, the firm expressed a more positive outlook on Camping World's medium to long-term opportunities, including both organic growth and potential mergers and acquisitions.
The meeting included CEO Marcus Lemonis, President Matt Wagner, and SVP of Corporate Development and Investor Relations Brett Andress. KeyBanc highlighted Camping World's recent follow-on offering, which they believe positions the company to chase growth opportunities while managing leverage effectively. The analyst's commentary suggests that Camping World's strategic move back into the used vehicle market and the potential for dealer acquisitions could significantly benefit the business model in fiscal year 2025.
According to KeyBanc's analysis, Camping World is anticipated to experience meaningful year-over-year growth, which would make it stand out within the leisure vehicle sector covered by the firm. The company's unique position in the recreational vehicle (RV) market is further reinforced by its potential for mergers and acquisitions, the profitability and resilience of its Good Sam enterprise, and other distinctive factors.
KeyBanc's reiteration of the Overweight rating and the $27 price target underscores the firm's confidence in Camping World's future performance and its potential to generate shareholder value.
In other recent news, Camping World Holdings reported steady third-quarter revenues of $1.7 billion in its earnings call for fiscal year 2024, despite procurement challenges in used inventory. The company saw a significant 31% increase in new unit sales, largely due to a strong performance in Class C RV sales. The adjusted EBITDA reached $67.5 million, and ambitious plans for growth were outlined, with the aim to exceed 15% market share through dealership acquisitions and improved inventory management.
Despite an 18% decline in used unit sales, Camping World is targeting low to mid-double-digit growth in this area for the upcoming year. The company is optimistic about its proprietary data's ability to help navigate macroeconomic challenges. Regarding future expectations, Camping World expects a more stable pricing environment and modest growth in 2025, according to the executives.
InvestingPro Insights
To complement KeyBanc's positive outlook on Camping World Holdings (NYSE:CWH), recent data from InvestingPro provides additional context for investors. Despite the optimistic view on future growth opportunities, it's worth noting that CWH's revenue growth has slowed, with a 6.14% decline in the last twelve months as of Q3 2024. This aligns with the company's strategic shift and potential focus on acquisitions to drive future growth.
InvestingPro Tips highlight that CWH has maintained dividend payments for 9 consecutive years, which may appeal to income-focused investors. However, the company's stock price movements are quite volatile, which could present both risks and opportunities for investors looking to capitalize on the anticipated growth.
Interestingly, while KeyBanc maintains an Overweight rating, InvestingPro data shows that CWH's P/E ratio is currently negative at -45.31, indicating that the company is not profitable over the last twelve months. This underscores the importance of the company's strategic moves and potential for future profitability.
For investors seeking a more comprehensive analysis, InvestingPro offers 11 additional tips for CWH, providing a deeper dive into the company's financial health and market position.
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