While the COVID-19 pandemic has rattled much of the travel industry, it has indeed turned out to be a boon for the recreational vehicle (RV) market. Over the past couple of months, the RV industry has been experiencing high demand and sales that have not been witnessed in a long time. Pent-up wanderlust amid the coronavirus crisis seems to be breathing new life into the industry. After being cooped up at home for long periods of time amid the virus scare, people can experience the much-needed freedom and fun with RV vacations.
Blowout RV shipments were recorded in July, setting a new record. Markedly, the industry delivered the strongest July performance in four decades. Total shipments soared 53.5% year over year to 43,035 units. Towable RVs climbed 56.6% year over year to 39,160 units. This was mainly aided by a 76.4% surge in conventional travel trailers units. Motorhomes increased 27.4% year over year to 3,875 units for the month.
RVing Gets Red Hot Amid Coronavirus
Dealer inventories were light when the pandemic first hit. Production was stalled for multi weeks since mid-March. However, once the lockdown restrictions were lifted, units started rolling off the assembly line. The industry started picking up since mid-April, with sales soaring since mid-May. According to a RV Industry Association spokeswoman, sales from dealers across America skyrocketed as much as 170% year over year for May.
With the weather getting warmer and lockdown restrictions easing, people have started looking for ways to venture out and travel responsibly. Trying to avoid flights and hotel stays amid the pandemic, individuals and families are hitting the roads in their recreational vehicles, which appear to be the safest bet now.
With a wide variety of offerings, there is an RV for every consumer at every price point. It’s not just RVs that are catching attention now, outdoor supplies in general — including fishing and camping gear — are also in high demand. Small- to- medium-sized RVs are emerging as top sellers and are especially popular with first-time buyers. It’s not just first-time buyers who are fueling the market; existing users of RVs are also upgrading their vehicles.
Not only are RV developers deploying new and superior technologies to enhance efficiency and convenience, consumers are also getting enthusiastic for off-the-grid-living.
Will 2020 be the Banner Year for RV Travel?
Social distancing is the key theme of the year. While there is a lot of optimism surrounding vaccine development, cautious public are likely to shun the normal means of travel for quite some time.
In the light of the present circumstances, RV vacations are emerging as the best social-distance travel option. RVs offer just what people are looking for right now. These vehicles are typically equipped with bed, washroom, kitchen, dishes, etc, making it easier to practice social distancing. There’s no need to share a hotel elevator or airplane bathroom. Travelers can cook meals inside the vehicle. RVs are enabling people to enjoy vacations with their families, while adhering to social distancing. Per a study conducted by the RV Industry Association, 46 million Americans plan to take an RV trip in the next 12 months. This is a boon for RV manufactures and dealers.
The pandemic has proven a shot in the arm for RV companies. Here are some stocks that should be on your watchlist.
LCI Industries LCII: Shares of this RV component manufacturer have increased 14.7% over the past three months. The Zacks Consensus Estimate for fiscal 2021 earnings suggests year-over-year growth of 25.2%. The company currently carries a Zacks Rank #1 (Strong Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.
Thor Industries THO: Shares of the largest manufacturer of RV have risen 13.6% over the past three months.The Zacks Consensus Estimate for fiscal 2021 earnings suggests year-over-year growth of 76.2%. The company currently carries a Zacks Rank #2 (Buy).
Camping World Holdings Inc. CWH: Shares of this RV retailer have surged 34.5% over the past three months. The Zacks Consensus Estimate for fiscal 2020 earnings suggests year-over-year growth of 833.3%. The company currently carries a Zacks Rank #3 (Hold).
REV Group, Inc. REVG: This Milwaukee-based RV maker currently carries a Zacks Rank #3. Shares of this firm have climbed 23.5% over the past three months. The Zacks Consensus Estimate for fiscal 2021 earnings suggests year-over-year growth of 651.5%.
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