Winnebago Industries Earnings Preview

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Investors braced for a bumpy ride ahead of Winnebago Industries' (NYS: WGO) earnings announcement as the company has wavered between beating and falling short of analyst predictions during the past fiscal year. The company will unveil its latest earnings on Thursday, March 15. Winnebago Industries is a manufacturer of motor homes, which are self-contained recreation vehicles used mainly in leisure travel and outdoor recreation activities.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Winnebago Industries, with two out of three analysts rating it a hold. Analysts are a bit more wary about the stock compared to three months ago.
  • Revenue forecasts: On average, analysts predict $120.1 million in revenue this quarter. That would represent a rise of 12.6% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.01 per share. Estimates range from a loss of $0.04 to a profit of $0.05.

What our community says:
CAPS All-Stars are split on Winnebago Industries, with 53.6% rating it an outperform and 46.4% giving it an underperform rating. Fools are of two minds on the stock, as 49.2% of the community is awarding it an outperform rating and 50.8% an underperform rating. Winnebago Industries' CAPS rating of two out of five stars is even gloomier than the community sentiment.

Management:
Winnebago Industries' profit has risen year over year by an average of 47.3% over the past five quarters. Revenue has now gone up for three straight quarters. The company's gross margin shrank by 2.6 percentage points in the last quarter. Revenue rose 6.6% while cost of sales rose 9.6% to $123.3 million from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. Winnebago Industries has seen decreasing gross margins year over year for the last three quarters. Gross margins reflect the total sales revenue retained after costs. Here are Winnebago Industries' reported margins for the last four quarters:

Quarter

Q1

Q4

Q3

Q2

Gross Margin

6.4%

6.5%

6.4%

10.6%

Operating Margin

0.5%

1.4%

0.4%

3.8%

Net Margin

0.8%

2.7%

0.9%

3.1%

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The Motley Fool owns shares of Winnebago Industries.Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Earnings estimates provided by Zacks.

At the time this article was published

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