What happened
Shares of recreational-vehicle maker Thor Industries (THO -0.27%) were down sharply on Monday afternoon, after earnings that missed estimates exacerbated the effects of a broad-based market sell-off.
As of 3:30 p.m. EDT, Thor's shares were trading down about 25.5% from Friday's closing price.
So what
Thor generated adjusted earnings per share of $0.67 in the quarter that ended on Jan. 31, up a bit from a year ago but short of Wall Street's expectations. Analysts polled by Thomson Reuters had expected adjusted earrings of $0.70 per share, on average.
A Thor Class A motorhome. Image source: Thor Industries.
The news wasn't all bad, though. Sales in North America improved 5.9% year over year, driving gains to gross margins, while dealer inventories were successfully reduced 16.5% to healthy levels.
Now what
CEO Bob Martin said that the company is optimistic about this year's peak selling season, with one caveat: the "uncertainties related to coronavirus." While Thor hasn't had to reduce or shut down production because of shortages of parts from virus-affected areas, investors should be aware that a virus-induced recession could have a significant impact on the business.
But so far, Martin said, the company hasn't yet seen any reductions in orders from dealers.
