Thor and Winnebago

As the Baby Boomers continue to transition into their retirement years, many of them are starting to hit the road and do all those things they didn't have time to do during their working years. For many that means buying a recreational vehicle (RV) and hitting the road. And that's pumping up the top line of the RV manufacturers. Today I'd like to look at two of those companies, Thor and Winnebago Industries, and see just how well their fundamentals stack up, and then try to determine if either one of them could possibly be a potential candidate for accumulation. 

As a consumer, a dividend investor, and a future retiree one day, I'm also interested in the possibility of traveling around the country seeing the nation while trading and investing in comfort. Who says you can't have fun while you're working? 

Thor Industries, Inc. designs, manufactures, and sells a range of recreational vehicles, and related parts and accessories in the United States and Canada. It operates through two segments, Towable Recreational Vehicles and Motorized Recreational Vehicles. The company offers travel trailers under the trade names of Airstream International, Classic Limited, Sport, Flying Cloud, Land Yacht, and Eddie Bauer; Interstate and Autobahn Class B motorhomes; conventional travel trailers and fifth wheels under the trade names of Cruiser, Rushmore, Zinger, Elevation, ReZerve, Sunset Trail, Montana, Springdale, Hornet, Sprinter, Outback, Laredo, Alpine, Bullet, Fuzion, Raptor, Passport, Cougar, Coleman, Kodiak, Aspen Trail, Voltage, Landmark, Bighorn, Sundance, Elk Ridge, Trail Runner, Cyclone, Prowler, Wilderness, Sportsmen, Vision, Spree, MXT, Durango, SportTrek, and Sonic; and luxury fifth wheels under the name of Redwood. It also manufactures and sells gasoline and diesel Class A and Class C motorhomes under the Four Winds, Hurricane, Windsport, Chateau, Daybreak, Challenger, Tuscany, Outlaw, Palazzo, Axis, Vegas, and A.C.E. trade names; lightweight travel trailers, fifth wheels, and specialty products under the Camplite, Quicksilver, Bearcat, and Axxess trade names; and equestrian recreational vehicle products with living quarters under the Trail Hand, Trail Express, Stratus, and Stratus Express trade names. It markets its recreational vehicles through independent dealers. Thor Industries, Inc. was founded in 1980 and is based in Elkhart, Indiana.
(Summary) (Company) (Chart)

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22 September 2015
Price $51.32
1yr Target $70.00
Analysts 7
Dividend $1.08
Payout Ratio 28.87%
1yr Cap Gain 36.39%
Yield 2.10%
1yr Tot Return 38.49%

EPS (ttm) $3.74
EPS next yr $4.46
EPS next 5yr 20.00%
1yr Potential $89.20
P/E 13.72
PEG 0.69
Beta 1.20
Market Cap $2.69 Bil
Revenues $3.99 Bil
Earnings $199.80 Mil
Profit Margin 4.98%

1yr EarnGR 16.31%
3yr EarnGR 20.16%
5yr EarnGR 60.96%
1yr DivGR 21.95%
3yr DivGR 25.70%
5yr DivGR 28.99%
Quick Ratio 1.60
Current Ratio 2.20
Debt/Equity 0.00
ROA 13.50%
ROE 19.40%

Winnebago Industries, Inc. manufactures and sells recreation vehicles primarily for use in leisure travel and outdoor recreation activities. The company manufactures motor homes, which are self-propelled mobile dwellings that provide living accommodations and include kitchen, dining, sleeping, and bath areas, as well as a lounge. It also offers travel trailers and fifth wheel trailers; original equipment manufacturing parts, including extruded aluminum and other component products for other manufacturers; and commercial transit buses to public and private transportation agencies for use in community based transit programs, para transit applications, hospitality shuttles, car rental shuttles, airport shuttles, and other various applications under the trade names of Metro. In addition, the company provides commercial vehicles, which are motorhome shells for law enforcement command centers, and mobile medical and dental clinics, as well as offers commercial vehicles as bare shells to third-party upfitters. The company sells its products primarily under the Winnebago, Itasca, and Winnebago Touring Coach brand names through independent dealers in the United States and Canada. Winnebago Industries, Inc. was founded in 1958 and is headquartered in Forest City, Iowa.
(Summary) (Company) (Chart)

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22 September 2015
Price $19.49
1yr Target $26.20
Analysts 5
Dividend $0.36
Payout Ratio 22.92%
1yr Cap Gain 34.42%
Yield 1.84%
1yr Tot Return 36.26%

EPS (ttm) $1.57
EPS next yr $1.82
EPS next 5yr 15.80%
1yr Potential $28.75
P/E 12.41
PEG 0.79
Beta 2.28
Market Cap $524.87 Mil
Revenues $971.40 Mil
Earnings $42.40 Mil
Profit Margin 4.32%

1yr EarnGR 45.13%
3yr EarnGR 58.00%
5yr EarnGR ---
1yr DivGR 0.00%
3yr DivGR ---
5yr DivGR ---
Quick Ratio 1.70
Current Ratio 3.40
Debt/Equity 0.00
ROA 12.10%
ROE 21.20%

My Perspective

Looking at the fundamental numbers above it's apparent to me that Thor Industries is the company to invest in because there are just too many holes in Winnebago Industries earnings and dividend growth rates. And these numbers are rather important to me. Thor Industries earnings and dividend growth rates are outstanding and the estimated one year total return of almost 40% is tough to ignore.

But a close look at the available fundamentals for Winnebago Industries reveals a company that is probably also a great company to add to my portfolio. And I would consider adding it to my accounts if I had tons of money, but I only have limited funds so my candidate for accumulation is Thor. And I intend to begin accumulating shares as soon as funds become available.

Finally, I think this category of investing (RVs) has a extended move higher for many years to come. I also believe that because the Baby Boom Generation has just started to retire these last few years and this wave of retirees will continue to increase through 2025. And that generation is both large and wealthy.