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Thor Industries (THO) Q2 Earnings & Revenues Beat Estimates

Thor Industries, Inc.THO reported second-quarter fiscal 2018 (ended Jan 31, 2018) adjusted earnings of $1.92 per share, surpassing the Zacks Consensus Estimate of $1.82. Net income grew 4% to $79.8 million from $64.8 million in the prior-year quarter.

Revenues rose 24% year over year to $1.97 billion and also outpaced the Zacks Consensus Estimate of $1.9 billion.

Gross profit increased 27.7% to $270.3 million from $211.7 million in second-quarter fiscal 2017. The gross profit margin increased to 13.7% compared with 13.3% in the year-ago quarter, driven by strong production and process improvement, primarily by Jayco.

Thor Industries, Inc. Price, Consensus and EPS Surprise

Thor Industries, Inc. Price, Consensus and EPS Surprise | Thor Industries, Inc. Quote

Segment Results

Sales of Towable RVs went up 26.9% year over year to $1.08 billion. This upside was primarily driven by strong demand for its affordably-priced travel trailers. Pre-tax income shot up 49.7% to $116.7 million from $78 million in the comparable quarter last fiscal. Growth in the metric was backed by higher sales and improved gross margin plus decreased selling, general and administrative (SG&A) expenses.

Sales from Motorized RVs improved 17.9% to $559.9 million from $475 million in the year-ago quarter. The upside was driven by robust demand for its Class A and Class C motor-homes by dealers and end consumers. Pre-tax income from the segment surged 31.8% to $37.5 million from $28.5 million a year ago, driven by enhanced gross margins and operating efficiency.

Financial Position

Thor Industries had cash and cash equivalents of $109.8 million as of Jan 31, 2018, down from $134.7 million as of Jan 31, 2017. Long-term debt was $80 million as of Jan 31, 2018, compared with $325 million recorded in the prior-year quarter.

In the first six months of fiscal 2018, Thor Industries' operating cash inflow increased to $56.8 million compared with $52.8 million during the same period in the previous fiscal.

The company incurred capital expenditures of $63,003 in the first six months of fiscal 2018 compared with $50,924 in the prior-year period.

Zacks Rank & Key Picks

Thor Industries has a Zacks Rank #3 (Hold). A few better-ranked stocks in the auto space are Honda Motor Co. Ltd. HMC , Toyota Motor Corporation TM and Genuine Parts Company GPC , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .

Honda has an expected long-term growth rate of 5.2%. In the last six months, shares of the company have gained 20.3%.

Toyota has an expected long-term growth rate of 5.8%. Shares of the company have gained 11.7% in the last six months.

Genuine Parts has an expected long-term growth rate of 6.6%. In the last six months, shares of the company have gained 6.8%.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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