Shares in recreational vehicle (RV) maker Camping World Holdings (NYSE:CWH) closed Wednesday down roughly 10%. The drop seems to be on no company-specific news, though competitor Winnebago Industries (NYSE:WGO) reported its fiscal fourth-quarter results today.
Winnebago posted strong quarterly results. It said revenue jumped 39%, earnings per share rose 45%, and cash flow from operations more than doubled compared to the year-ago period. But shares of Winnebago were also down more than 10% today.
The COVID-19 pandemic has led to renewed interest in camping and vacationing with RVs, as people seek more isolation and have been slow to embrace plane travel. Winnebago said it ended its quarter with record backlogs as strong demand continues. So what explains the stocks going down?
The industry has been in its own bull market since the peak of the pandemic. Since the March lows, Winnebago shares are up 160% while Camping World shares have soared more than 500%.
More recently, Winnebago stock had increased more than 17% just in the past four weeks, prior to today's drop. Today's reversal may just be investors giving back some of those gains, and selling on the news.
Nothing in Winnebago's earnings report appears to be negative news. The company was optimistic about its prospects, and raised its dividend by 9%. Whether Winnebago shares dropped because of the recent run-up, or for some other reason, it seems Camping World shares were just moving in sympathy today.