Winnebago profit nearly doubles as economy picks up
(Reuters) - Winnebago Industries Inc (WGO.N) said its quarterly profit almost doubled in the important spring selling season as rising U.S. consumer confidence pushed up demand for its motor homes, offering further evidence of a strengthening U.S. economy.
More baby boomers - Winnebago's primary customers - are taking to the road in the company's luxury vehicles, encouraged by cheap credit and a recovering housing market.
Winnebago said on Thursday sales of motor homes jumped 55 percent to 1,978 units in the third quarter ended June 1, while sales of trailers rose 10 percent. The order backlog for motor homes more than doubled to $292.3 million, the company said.
Winnebago's shares have more than doubled in the past 12 months, far outperforming the 20 percent rise in the S&P 500 .SPX index. The stock was up 0.7 percent at $21.12 at midday on the New York Stock Exchange.
"We have had exceptional growth throughout fiscal 2013, experiencing the best shipment quarter in over five years," Chief Executive Randy Potts said in a statement. (r.reuters.com/tyz29t)
U.S. recreational vehicles shipments are expected to increase by 7.5 percent to more than 300,000 units in calendar 2013, according to the Recreation Vehicle Industry Association. (r.reuters.com/hut29t)
Winnebago, which sells large touring vehicles and travel trailers that provide home-like comfort on the road, has introduced cheaper products for Americans below the age of 50.
The company has also introduced features such as bunk beds, to attract families with younger children, Potts told Reuters.
Winnebago's net income rose 94 percent to $7.7 million, or 27 cents per share, in the quarter from $3.9 million, or 13 cents per share, a year earlier.
Revenue jumped 40 percent to $218.2 million.
Analysts on average had expected a profit of 27 cents per share on revenue of $197.8 million, according to Thomson Reuters I/B/E/S.
At $21.12, the stock is trading at just above its intrinsic value of $20.42, as measured by Thomson Reuters StarMine.
The StarMine model is a measure of how much a stock should be worth currently when considering expected growth rates over the next 15 years and adjusting for analysts' systematic biases.
(Editing by Roshni Menon and Ted Kerr)
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