If you were looking at the news on Camping World Holdings (CWH), and wondering why it spiked today, one key bit of news likely fueled that fire. Word from analysts at JPMorgan say that Camping World may have a lot of upward potential. Investors bought in in response, and in a big way, sending shares surging over 7% in Thursday afternoon’s trading.
The good news for Camping World came from Ryan Brinkman, JPMorgan analyst, who noted that Camping World shares could see as much as a 70% rally going forward. Brinkman upgraded shares from Neutral to Buy, though he slimmed down the price target a bit, from $21 per share to $19. That still represents a surge of 74.1% against closing prices on Wednesday, reports noted.
What would fuel this kind of massive gains? Brinkman pointed to “…numerous idiosyncratic drivers of strong earnings growth with comparatively less tariff exposure.” That by itself did quite a job for Camping World’s future going forward, but Brinkman carried on. Brinkman noted that the recent 14% loss in Camping World shares was an “overreaction,” and that Camping World was likely to see a “…sharp profit pivot” in the near-term.
Not Everyone is So Sure
While Brinkman seems to think that Camping World is on the cusp of an upward explosion that would be the stuff of legends, not everyone is so sure. That 14% loss that it posted recently, reports noted, came as investors were concerned about the fate of RV sales. With new unit sales down 2% for the quarter, based on Camping World’s recent earnings report, and used sales up 28.5%, there is still interest, but people are clearly more interested in used than new, and are looking for a deal.
This is particularly true in light of the fact that, about a week ago, Heartland Recreational Vehicles announced plans to close its Sturgis, Michigan plant. The closure meant 121 jobs lost. And why? Reports noted that Heartland cited “business necessity” as the reason for closure. Some wondered if the Heartland employees in Sturgis were offered transfer to newer facilities in Elkhart, Indiana instead, which would make this more of a consolidation than a layoff. But Heartland was not talking either way.
Is Camping World Holdings Stock a Good Buy Right Now?
Turning to Wall Street, analysts have a Strong Buy consensus rating on CWH stock based on eight Buys and one Hold assigned in the past three months, as indicated by the graphic below. After a 34.13% loss in its share price over the past year, the average CWH price target of $19.67 per share implies 51.66% upside potential.