On Thursday, Benchmark began coverage on shares of Thor Industries Inc. (NYSE:THO), issuing a Hold rating on the recreational vehicle manufacturer. The firm's analysis suggests that there may be more opportune moments to invest in the stock in the future.
The coverage was initiated based on a Discounted Cash Flow (DCF) model, which estimated Thor Industries' enterprise value (EV) at approximately $5.2 billion and its market capitalization at $4.2 billion.
The valuation anticipates a mid-cycle Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of around $840 million to be achieved in approximately three years, which is consistent with the firm's Fiscal Year 2024 estimate. This projection indicates a flat growth trajectory, with potential challenges stemming from modest recovery prospects and possible market share losses.
Benchmark's valuation applies a 7x multiple on the company's anticipated mid-cycle EBITDA. The firm also referenced Thor Industries' next twelve months (NTM) EV/EBITDA and Price to Earnings (P/E) multiples, which stand at 9x and 19x, respectively. The analyst from Benchmark indicated a preference for a more substantial upside before considering the stock more favorably for long positions.
Thor Industries' stock performance will continue to be monitored as the company navigates the market, with potential investors looking for signs of stronger recovery and growth that could influence future valuations and ratings.
In other recent news, Thor Industries has been the subject of multiple analyst adjustments following a weaker-than-expected fiscal fourth-quarter guidance and a decrease in third-quarter results. Despite this, the company maintains a revised full-year 2024 guidance, expecting consolidated net sales to range between $10.0 billion and $10.5 billion.
Furthermore, Thor Industries declared a regular quarterly cash dividend of $0.48 per share. Argus analysts have maintained a Hold rating on the company, while BMO Capital and Baird have both kept an Outperform rating.
On the other hand, Citi reduced its price target for the company but maintained a Buy rating, and Roth/MKM held a cautious stance, maintaining a Neutral rating. These are among the recent developments for Thor Industries.
InvestingPro Insights
As investors consider Benchmark's hold rating on Thor Industries Inc. (NYSE:THO), real-time data from InvestingPro offers additional insights into the company's financial health and market performance. With a market capitalization of $5.33 billion and a P/E ratio standing at 21.02, Thor Industries shows a valuation that aligns with industry standards. However, the company's revenue has seen a decline of 16.04% over the last twelve months as of Q3 2024, which could be a point of concern for potential investors.
On the positive side, Thor Industries has demonstrated a commitment to returning value to shareholders, having raised its dividend for 9 consecutive years and maintained dividend payments for 38 consecutive years. The dividend yield currently stands at 1.92%, with a growth of 6.67% over the last twelve months as of Q3 2024. This consistency in dividend payments may appeal to income-focused investors.
For those considering a deeper dive into Thor Industries' financials and future prospects, InvestingPro provides additional analysis and metrics. Notably, the company is expected to remain profitable this year, with a fair value estimated at $115.23 by InvestingPro, higher than the latest analyst target of $103.5.
For access to more exclusive metrics and to make the most informed decisions, use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription. Moreover, there are 6 additional InvestingPro Tips available for Thor Industries, which could further guide investment strategies.
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