Winnebago price target lowered to $42 from $50 at BMO Capital

Investing.com - BMO Capital lowered its price target on Winnebago Industries (NYSE:WGO) to $42 from $50 while maintaining an Outperform rating on the stock. The recreational vehicle manufacturer’s shares currently trade at $28.24, significantly below InvestingPro’s Fair Value estimate, suggesting potential upside opportunity.

The price target reduction follows Winnebago’s fiscal third-quarter 2025 results, which aligned with preliminary figures but came with a cut to full-year guidance. Despite the guidance reduction being largely anticipated by investors, Winnebago stock fell 10% on Wednesday, continuing a challenging period that has seen the stock decline nearly 40% over the past six months.

BMO Capital attributed the sharp stock decline to several factors, including a greater-than-expected tariff impact projected for fiscal year 2026, general market caution about the second half of calendar 2026, and ongoing challenges with the turnaround of Winnebago’s motorized vehicle division.

The research firm noted that while Winnebago faces near-term headwinds, the company maintains "a solid brand portfolio" in its assessment. BMO Capital also expressed continued confidence in long-term trends for the outdoor recreation industry.

The analyst reduced earnings estimates for Winnebago to reflect these challenges, though the maintained Outperform rating suggests BMO Capital still sees upside potential despite the lowered price target. This view aligns with InvestingPro’s analysis, which shows the stock trading near its 52-week low of $28.19, potentially presenting a value opportunity for investors seeking exposure to the recreational vehicle sector.

In other recent news, Winnebago Industries reported disappointing third-quarter earnings for fiscal 2025, with both earnings per share (EPS) and revenue missing analyst expectations. The company posted an EPS of $0.81, falling short of the forecasted $0.90, and revenue of $775.1 million, slightly below the expected $779.46 million. Following these results, Winnebago revised its full-year fiscal 2025 guidance, lowering its EPS forecast to $1.20-$1.70 and revenue expectations to $2.7-$2.8 billion. KeyBanc Capital Markets and Truist Securities both lowered their price targets for Winnebago, to $34 and $36 respectively, while maintaining favorable ratings. KeyBanc noted the company’s resilience in market share and disciplined shipment strategy, while Truist highlighted a cautious outlook due to consumer uncertainty and potential tariff impacts. Despite these challenges, Winnebago observed market share gains in several motorhome categories and expects new product launches to drive future growth. The company remains focused on operational efficiency and cost management amid broader macroeconomic uncertainties affecting the leisure vehicle industry.

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