Camping World Holdings (CWH) Company Overview & Stock Price Forecast
This article provides a brief analysis and stock rating for Camping World Holdings (CWH) including an updated stock price target. Additional data on the company’s earnings yield, price/earnings ratio, return on invested capital and YTD performance are discussed as well.
Camping World Holdings Fundamentals
Stock Price Target: $52.38
In the section below, we discuss the earnings yield, P/E, return on invested capital and YTD performance for Camping World Holdings in comparison to the Automotive Retail industry and the S&P 500.
Camping World Holdings is a Mid Cap company with a Market Cap of $3.47B.
How are investors using Camping World Holdings earnings yield to assess the company?
The earnings yield is used to show the percentage of a company’s earnings per share. Investors typically use earnings yield to determine which assets are underpriced or overpriced relative to other variables, like sector, industry or bond yields. Simply put, the earnings yield of a company can be used to assess how expensive a company is in relation to the earnings that are generated. When valuing companies, the SIS Research Group does not utilize the inverse P/E ratio to calculate the earnings yield. Instead, we use an adjusted earning yield calculation to capture variation amongst companies (i.e. debt and tax rates).
The current earnings yield for Camping World Holdings is 24.44%, in comparison to 3.50% for the S&P 500 and 1.35% for the 10-year treasury bond. The median earnings yield for the Auto Retail industry is 5.74%.
What does Camping World Holdings Price-to-Earnings Ratio (P/E) tell investors about the company?
The price-to-earnings ratio (P/E) is a relatively popular metric used by investors and analysts for valuing a company’s stock. The P/E ratio can be used to show how a stock’s valuation compares to other companies and the total market. Investors use the P/E ratio to determine what the market is willing to pay today based on a company’s past or future earnings. A high P/E ratio could mean that a stock’s price is too high relative to earnings, which could be a signal that a stock is currently overvalued. In turn, a low P/E ratio could indicate that a company’s current stock price is low relative to earnings.
Camping World Holdings is currently trading at a P/E of 7.05. The P/E for the Auto Retail industry is 17.52 and the P/E for the S&P 500 is 28.94.
What is the current Price-to-Sales Ratio (P/S) for Camping World Holdings?
The Price-to-Sales Ratio (P/S) looks at a company’s market cap and revenue to determine valuation. The P/S ratio is calculated by taking a company’s market cap and dividing by the total sales or revenue. The P/S ratio gives an idea of how much the market values every dollar of a company’s sales and can be effective in valuing unprofitable growth stocks or companies that are currently undergoing special situations or challenges. A lower the P/S ratio can be an indicator of good value.
Camping World Holdings is currently trading at a P/S of 0.29. The P/S for the Auto Retail industry is 0.86 and the P/S for the S&P 500 is 3.14.
How does Camping World Holdings Price-to-BookRatio (P/B) compare to the Automotive Retail industry?
Price-to-book value (P/B) is the ratio of the market value of a company’s shares divided by its book value of equity (the value of it’s assets on the books). The book value is the difference between the book value of assets and liabilities. Typically, investors use the P/B ratio to assess if a stock is valued properly (a value of one means that the stock price is trading in line with the book value of the company). A company with a high P/B ratio could mean the stock price is overvalued as well as the converse.
Camping World Holdings P/B ratio is 64.39. The P/B for the Auto Retail industry is 5.99 and the P/B for the S&P 500 is 4.74.
How attractive is Camping World Holdings Return on Invested Capital (ROIC) to investors?
Investors use the return on invested capital (ROIC) to assess how efficient a company is at turning capital into profits. The ROIC is the amount of money a company makes on it’s investments that is above the average cost of debt and equity.
Investors can use the ROIC to provide context for metrics like the (P/E) ratio. For instance, when used in isolation a low P/E ratio could suggest a company is oversold but the decline could be because a company is no longer generating value for shareholders. Conversely, companies that consistently generate high rates of ROIC can plausibly trade at a premium compared to other stocks, even if their P/E ratios are high.
Camping World Holdings ROIC is currently 12.63% in comparison to 10.10% for the Auto Retail industry and 8.60% for the S&P 500.
What is Camping World Holdings YTD Performance in comparison to its industry and the total market?
The year-to-date (YTD) performance is the amount of profit/loss realized by a stock since the first trading day of the current calendar year.
The YTD performance for Camping World Holdings is 54.20%. The Auto Retail industry has a YTD performance of 45.34% in comparison to the YTD S&P 500 performance of 24.73%.
Recent Financial Results
- Third quarter revenue of $1.91B, an increase of $237.8M, or 14.2%
- Gross profit of $691.4M, an increase of $158.2M, or 29.7%, and gross margin was 36.1%
- Net income of $189.3M, an increase of $34.5M, or 22.3%
- Adjusted EBITDA reported of $288M, an increase of $71M, or 32.7%
- Vehicle inventories were $1.4B, an increase of $433.8M; new vehicle inventories of $723.6M, an increase of $166.5M, and used vehicle inventories were $391.5M, an increase of $267.3M
Stock Price Target: $52.38
Camping World Holdings operates as a recreational vehicle (RV) and outdoor retailer. It operates through two segments, Good Sam Services and Plans and RV and Outdoor Retail. The company provides a portfolio of services, protection plans, products, and resources in the RV industry.
As of June 2021, the company operated through a network of approximately 175 retail locations in 38 states of the United States. It serves customers through dealerships, and online and e-commerce platforms. The company was founded in 1966 and is headquartered in Lincolnshire, Illinois. The current CEO is Marcus Lemonis.
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This material is provided for informational purposes only and is not financial advice. The information contained herein should not solely be used for the formation of an investment decision, whether you are a long term or short term investor.