RV Industry Stocks Still Garnering Healthy Gains
Recreational vehicle industry stocks continued to post impressive gains as the stock market itself garnered record highs Wednesday (Dec. 7). The Dow Jones Industrial Average closed out the day up 297.84 points to 19,549.62 while he NASDAQ Composite rose 60.76 to 5,393.76 and the S&P 500 gained29.12 to 2,241.35.
Publicly traded RV-related stocks by mid-day Wednesday reflected admirable monthly gains across the board:
- Patrick Industries Inc. (PATK) – up 32.52%
- Drew Industries Inc. (DW) – up 26.44%
- Thor Industries Inc. (THO) – up 42.73%
- Cummins Inc. (CMI) – up 17.87%
- Winnebago Industries Inc. – up 33.64%
- Skyline Corp. (SKY) – up 36.13%
Given the overall recent performance of the stock market — as well as the continuing growth of the RV marketplace on the heels of a seven-year runup — the magnitude of these escalating stock prices shouldn’t come as a complete surprise to most stock watchers.
“The analysts that I pay the most attention to continue to tell us that we are in what is called a long-term, secular bull market,” points out Mel Jacobson, who, with his brother, Moe Jacobson, co-manages independently owned branches affiliated with Raymond James Financial Services in Elkhart, Ind., and Petaluma, Calif., respectively. “And while many people feel that the stock market is high, their conclusion is that parts of it are high, but most of it is fairly valued and has significant running room for several years.”
Having said that, Jacobson took a predictably cautious view of the recreational vehicle arena from an investment standpoint, based on its historical volatility.
“Well, the key for the RV industry is going to be a combination of gas prices and interest rates because of the financing aspect of it,” he told RVBUSINESS.com. “And if those two issues continue to remain in check, there’s no reason to believe that there should be a sudden downturn in the industry.
“That said,” he added, “the RV industry has always been a volatile industry, often tending to overreact both to the upside and to the downside. And there is no way to know whether this is an overreaction. Some of the technical indicators are still showing that some of these stocks are screening very well for the near term. They still technically look very strong going forward.”