Thor Industries stock upgraded by KeyBanc on potential growth drivers

Investing.com - KeyBanc upgraded Thor Industries Inc. (NYSE:THO) from Underweight to Sector Weight following recent meetings with the company’s management. According to InvestingPro data, Thor currently trades below its Fair Value, with a solid financial health score of 2.32 out of 4, indicating FAIR conditions.

The recreational vehicle manufacturer continues to expect similar financial results in fiscal year 2026 compared to fiscal year 2025, according to KeyBanc analyst commentary released Friday.

Despite projecting a similar industry backdrop next year, Thor Industries outlined several potential growth drivers, including savings from the Heartland realignment and margin opportunities through lower-cost production in Europe, specifically highlighting a volume ramp in Poland.

Additional growth factors mentioned include the potential turnaround at Keystone to stem share losses and a new business-to-business parts operation that will be unveiled at the upcoming Open House event.

KeyBanc noted that investors appear increasingly willing to accept heavier valuation amid improved consumer sentiment, prospects of interest rate cuts, potentially helpful tax legislation next year, and a perceived lower likelihood of an imminent recession.

In other recent news, Thor Industries reported fiscal third-quarter results that exceeded expectations, with shipments surpassing retail forecasts and improved margins. Despite the strong performance, Thor Industries maintained its fiscal year 2025 guidance, citing ongoing macroeconomic uncertainties. Analysts from BMO Capital maintained an Outperform rating on the company’s stock, highlighting the leverage in Thor’s business model when volumes increase, although they noted softer-than-anticipated retail demand. Citi analysts raised their price target for Thor Industries stock to $88, reflecting the strong quarterly performance, but retained a Neutral rating due to concerns about sustainability into the fourth quarter. Meanwhile, KeyBanc reaffirmed its Underweight rating with a $65 price target, pointing to anticipated challenges in the upcoming quarters.

Additionally, Thor Industries announced a new $400 million share repurchase program, effective until July 31, 2027, replacing the previous authorization. The company also declared a quarterly cash dividend of $0.50 per share, payable on July 15, 2025, to shareholders of record as of July 1, 2025. These developments reflect Thor’s strategic financial maneuvers amid a cautious economic outlook.

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