Q2 Earnings Outperformers: Camping World (NYSE:CWH) And The Rest Of The Vehicle Retailer Stocks

Adam Hejl /
2023/09/26 4:29 am EDT

The end of an earnings season can be a great time to assess how companies are handling the current business environment and discover new stocks. Let’s have a look at how Camping World (NYSE:CWH) and the rest of the vehicle retailer stocks fared in Q2.

Buying a vehicle is a big decision and usually the second-largest purchase behind a home for many people, so retailers that sell new and used cars try to offer selection, convenience, and customer service to shoppers. While there is online competition, especially for research and discovery, the vehicle sales market is still very fragmented and localized given the magnitude of the purchase and the logistical costs associated with moving cars over long distances. At the end of the day, a large swath of the population relies on cars to get from point A to point B, and vehicle sellers are acutely aware of this need.

The 4 vehicle retailer stocks we track reported a weaker Q2; on average, revenues beat analyst consensus estimates by 0.57%, Investors abandoned cash burning companies since high interest rates will make it harder to raise capital and vehicle retailer stocks have not been spared, with share prices down 14.5% since the previous earnings results, on average.

Weakest Q2: Camping World (NYSE:CWH)

Founded in 1966 as a single recreational vehicle (RV) dealership, Camping World (NYSE:CWH) still sells RVs along with boats and general merchandise for outdoor activities.

Camping World reported revenues of $1.9 billion, down 12.4% year on year, missing analyst expectations by 3.54%. It was a weak quarter for the company, with revenue missing analysts' expectations, starting with a meaningful same-store sales miss. The company also missed Wall Street's EPS expectations.

Marcus Lemonis, Chairman and Chief Executive Officer of Camping World Holdings, Inc. stated, “We sold the most used units in our Company’s history, with record setting used vehicle gross profit. We’ve opened, acquired, or signed letters of intent on 30 dealership locations year-to-date. The unprecedented influx of acquisition opportunities has continued and the pipeline is robust. We plan to capitalize on it as we invest ahead of anticipated revenue growth in 2024 and beyond.”

Camping World Total Revenue

Camping World delivered the weakest performance against analyst estimates of the whole group. The stock is down 36.2% since the results and currently trades at $19.95.

Read our full report on Camping World here, it's free.

Best Q2: CarMax (NYSE:KMX)

Known for its transparent, customer-centric approach and wide selection of vehicles, Carmax (NYSE:KMX) is the largest automotive retailer in the United States.

CarMax reported revenues of $7.69 billion, down 20.4% year on year, beating analyst expectations by 2.29%. It was a decent quarter for the company, with optimistic earnings guidance for the next quarter. However, the correction in the used car market caused same-store sales to drag, leading to declining revenue.

CarMax Total Revenue

CarMax had the slowest revenue growth among its peers. The stock is down 1.78% since the results and currently trades at $76.9.

Is now the time to buy CarMax? Access our full analysis of the earnings results here, it's free.

America's Car-Mart (NASDAQ:CRMT)

With a strong presence in the Southern and Central US, America’s Car-Mart (NASDAQ:CRMT) sells used cars to budget-conscious consumers.

America's Car-Mart reported revenues of $368 million, up 9.27% year on year, beating analyst expectations by 1.15%. It was a weak quarter for the company, with retail units sold missing analysts' expectations, but revenue beat. In addition, EPS missed by a large margin because provision for credit losses and net charge offs were both meaningfully higher this quarter than in the same period last year.

The stock is down 20.9% since the results and currently trades at $89.85.

Read our full analysis of America's Car-Mart's results here.

Lithia (NYSE:LAD)

With a strong presence in the Western US, Lithia Motors (NYSE:LAD) sells a wide range of vehicles, including new and used cars, trucks, SUVs, and luxury vehicles from various manufacturers.

Lithia reported revenues of $8.11 billion, up 12% year on year, beating analyst expectations by 2.37%. It was a decent quarter for the company, with a solid beat of analysts' revenue and EPS estimates.

Lithia achieved the strongest analyst estimates beat and fastest revenue growth among the peers. The stock is up 0.36% since the results and currently trades at $293.43.

Read our full, actionable report on Lithia here, it's free.

The author has no position in any of the stocks mentioned