Shares of Camping World Holdings, Inc. (NYSE:CWH), a leader in outdoor and camping products offering vehicles, RV and camping gear, maintenance and repair, among other products, are up 10% as of 4:00 p.m. EDT Thursday after news of an acquisition.
Camping World announced Thursday that it signed an agreement to acquire Holiday Hour RV located in the greater Dekalb, Illinois, area, joining the SuperCenter in the Wauconda/Island Lake area as the company's second Illinois location. The news was met with optimism by investors who only a day ago sent the stock 14% lower after second-quarter results failed to live up to estimates. Camping World's second-quarter revenue was an all-time record high, at $1.45 billion, but adjusted earnings per share of $0.96 fell short of analysts' estimates calling for $1.02 per share.
"Since 1972, Holiday Hour RV has established itself as a successful and well-known RV dealership in the state of Illinois," said Marcus Lemonis, chairman and CEO of Camping World Holdings. "We are pleased to announce this acquisition and look forward to the continued expansion of our market share throughout the Chicagoland area."
Recently, the company announced the planned expansion of its RV sales locations by more than 30%, through multiple avenues such as this acquisition, along with the launch of Gander RV Sales and new store openings. And while some short-term investors weren't willing to wait around for that growth on Wednesday, the sudden acquisition announcement convinced some investors that perhaps the growth strategy isn't that far in the distance. In fact, COO Brent Moody put it succinctly: "We are well-positioned to remain a leader in the RV industry as it continues to evolve."