What Happened?
Shares of recreational vehicle (RV) and boat retailer Camping World (NYSE: CWH) fell 17.2% in the morning session after the company reported disappointing fourth-quarter results that included a wider-than-expected loss and deteriorating margins.
The recreational vehicle retailer posted an adjusted quarterly loss of $0.73 per share, significantly missing the consensus estimate of a $0.47 loss. This result was also worse than the $0.47 per share loss from the same period a year ago. While revenue for the quarter fell by 2.6% year-over-year to $1.17 billion, it did narrowly beat expectations. However, investors focused on the weak profitability, as the company's operating margin worsened to negative 4.3% from negative 1.3% a year earlier. Furthermore, free cash flow burn increased to $272.5 million from $186 million in the prior-year quarter, highlighting growing financial pressures.
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What Is The Market Telling Us
Camping World’s shares are extremely volatile and have had 44 moves greater than 5% over the last year. But moves this big are rare even for Camping World and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 5 days ago when the stock gained 3.8% on the news that the Supreme Court struck down sweeping Trump tariffs, bringing potential relief to companies impacted by international trade disputes.
The ruling was seen as a significant win for sectors reliant on global supply chains, as tariffs, which are essentially taxes on imported goods, have increased operating costs and squeezed profit margins for many U.S. companies. The removal of these levies is expected to lower expenses for manufacturers and retailers, potentially leading to more competitive pricing and stronger earnings. This positive development appeared to outweigh earlier concerns in the session regarding reports of slowing economic growth and rising inflation, with the broader market, including the S&P 500, ticking higher on the news. In response to the ruling, the Trump administration announced plans to impose a new 10% global tariff.
Camping World is down 7% since the beginning of the year, and at $9.03 per share, it is trading 56.6% below its 52-week high of $20.80 from February 2025. Investors who bought $1,000 worth of Camping World’s shares 5 years ago would now be looking at an investment worth $282.30.
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