Editor’s Note: The following post contains excerpts from a blog by investment analyst Mike Cintolo, writing in a current issue of “The Iconoclast Investor.” His blogs can be read at www.iconoclast-investor.com.
Interestingly, I’m seeing some positive action in many “non-growth” stocks. One of these is Thor Industries Inc., which was featured in Cabot Top Ten Report back on August 10. Here’s what I had to say about it:
“You may not have heard of Thor Industries, but you’ve certainly heard of some of its brands of travel trailers, recreational vehicles and buses. Thor got started in 1980 when it acquired Airstream, maker of the iconic aluminum travel trailers. Thor bought General Coach in 1982, El Dorado Bus in 1988, National Coach and Dutchmen Manufacturing in 1991, Champion Bus in 1998, merged with Keystone RV in 2001, bought Damon in 2003, Crossroads RV in 2004 and Goshen Coach in 2005. This aggressive program of acquisition has made Thor a giant in the industry and a U.S. manufacturing success story. Investors see big potential in travel trailers and RVs as Boomers hit the road in retirement. The company’s earnings took a big hit in its Q2 report, but it stayed profitable, which is more than can be said for many others in the automotive industry. This is a good story and a company making its debut in today’s Cabot Top Ten Report. We like it.”
Granted, it’s not a revolutionary story, but companies like Thor often produce big gains early on in bull markets (their industries are some of the first to turn up) as earnings rise sharply. The stock itself broke out of a well-formed three-month base at the end of July, when it soared above 24 on gargantuan volume (there were two days of more than quadruple average volume!), and THO has since retreated in a very calm, cool and collected manner. It now stands around 26.
I think there will be good support in the 23 to 24 area, and think buying some THO here is a great risk-reward opportunity.
More about Mike: A growth stock and market timing expert, Michael Cintolo is editor of Cabot Market Letter and Cabot Top Ten Report. In his 10 years at Cabot, he has uncovered exceptional growth stocks and helped to create new tools and rules for buying and selling stocks. Perhaps most notable was his development of the proprietary trend-following market timing system,Cabot Tides, that has helped Cabot place among the top handful of market-timing newsletters numerous times. An avid student of the market, Mike has appeared at the World Money Show in Orlando and is a regular guest on TopStockAnalysts.com, WallSt.net and WallStreetReporter.com.