Looking back on vehicle retailer stocks’ Q2 earnings, we examine this quarter’s best and worst performers, including Camping World (NYSE:CWH) and its peers.
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 slower Q2. As a group, revenues missed analysts’ consensus estimates by 0.8%.
Stocks, especially growth stocks with cash flows further into the future, had a good end of 2023. On the other hand, this year has seen more volatile stock market swings due to mixed inflation data, and while some vehicle retailer stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 1.1% since the latest earnings results.
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 $1.81 billion, down 5% year on year. This print fell short of analysts’ expectations by 3.1%. Overall, it was a softer quarter for the company with a miss of analysts’ earnings estimates.
Marcus Lemonis, Chairman and Chief Executive Officer of Camping World Holdings, Inc. stated, “Our record new unit market share was a direct result of listening to the consumer and their mandate for affordability. We saw year-over-year same store new vehicle unit growth accelerate into the mid-teens in June and into the low-twenties in July, positioning our Company for a strong 2025.”
Camping World delivered the weakest performance against analyst estimates of the whole group. The market was likely pricing in the results, and the stock is flat since reporting. It currently trades at $23.06.
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Best Q2: Lithia (NYSE:LAD) With a strong presence in the Western US, Lithia Motors (NYSE: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 $9.23 billion, up 13.8% year on year, in line with analysts’ expectations. The business had a strong quarter with a decent beat of analysts’ earnings estimates.
Lithia pulled off the fastest revenue growth among its peers. The market seems content with the results as the stock is up 1.8% since reporting. It currently trades at $281.05.
Weakest Q2: 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 $347.8 million, down 4.9% year on year, exceeding analysts’ expectations by 1.2%. Still, it was a softer quarter as it posted a miss of analysts’ earnings estimates.
As expected, the stock is down 18.3% since the results and currently trades at $49.09.
CarMax (NYSE: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 $7.11 billion, down 7.5% year on year. This number was in line with analysts’ expectations. It was a satisfactory quarter as it also produced a solid beat of analysts’ gross margin estimates.
However. CarMax had the slowest revenue growth among its peers. The stock is up 11.1% since reporting and currently trades at $79.27.
This content was originally published on Stock Story
