Camping World Holdings, Inc. CWH has entered into an agreement to acquire seven dealerships from Lazydays Holdings, Inc. The company will acquire locations in Surprise, AZ, Murfreesboro, TN, Sturtevant, WI, Council Bluffs, IA, Elkhart, IN, Portland, OR and Woodland, WA.
This transaction is estimated to be valued at approximately book value, with Camping World expecting a net cash outlay between $10 million and $20 million after real estate financing proceeds.
This acquisition allows Camping World to enhance its product offering with a traditional mix of travel trailers, fifth wheels and Class B and Class C RVs. These locations feature top OEM brands, including Grand Design, Thor and Forest River.
Camping World estimates that the market within a 50-mile radius of each dealership accounts for more than 65,000 new and used RV units sold annually, presenting growth opportunities for market share expansion. Despite operating in a challenging RV market, these locations generated nearly $200 million in revenues on a trailing twelve-month basis. The company aims to capitalize on the current favorable environment for dealership mergers and acquisitions.
CWH’s Price Performance
Shares of this recreational vehicle dealer have increased 15.9% in the past six months, outperforming the Zacks Leisure and Recreation Services industry’s 11% growth. The company has been benefiting from strong new and used same-store unit sales, acquisitions of new and used RV dealerships and the opening of stores. However, high costs and price fluctuations remain headwinds. The company remains cautious in this regard.
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Camping World primarily focuses on strategic investments in acquisitions to increase its footprint. The company aims at maximizing the returns of working capital to continue its supercharged acquisition plan, which directly sparks CWH’s growth prospects. In the first nine months of 2024, CWH’s RV and Outdoor Retail segment acquired assets from various RV dealerships, totaling nine locations for about $69.4 million.
For 2025, the company plans to focus on rebuilding its used vehicle business. CWH aims to maintain its leadership position in the RV market. The company will also continue expanding its success in sales, service and new unit market share. The Zacks Consensus Estimate for 2025 sales and earnings per share (EPS) indicates 7% and 357.5% year-over-year growth, respectively.
CWH’s Zacks Rank & Key Picks
Camping World currently carries a Zacks Rank #3 (Hold).
Here are some better-ranked stocks from the Zacks Consumer Discretionary sector.
Carnival Corporation & plc CCL currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.
CCL has a trailing four-quarter earnings surprise of 318.1%, on average. The stock has surged 66.8% in the past year. The Zacks Consensus Estimate for CCL’s fiscal 2024 sales indicates growth of 16.6% from year-ago levels.
Norwegian Cruise Line Holdings Ltd. NCLH currently carries a Zacks Rank #2 (Buy). NCLH has a trailing four-quarter earnings surprise of 4.2%, on average. The stock has surged 80.7% in the past year.
The Zacks Consensus Estimate for NCLH’s 2024 sales and EPS indicates growth of 10.2% and 127.1%, respectively, from year-ago levels.
Royal Caribbean Cruises Ltd. RCL currently carries a Zacks Rank #2. RCL has a trailing four-quarter earnings surprise of 16.2%, on average. The stock has surged 118.8% in the past year.
The Zacks Consensus Estimate for RCL’s 2024 sales and EPS indicates growth of 18.6% and 71.6%, respectively, from year-ago levels.
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