For most investors, how much a stock’s price changes over time is important. This factor can impact your investment portfolio as well as help you compare investment results across sectors and industries.
The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.
What if you’d invested in Winnebago Industries (WGO) ten years ago? It may not have been easy to hold on to WGO for all that time, but if you did, how much would your investment be worth today?
Winnebago Industries’ Business In-Depth
With that in mind, let’s take a look at Winnebago Industries’ main business drivers.
Headquartered in Iowa, Winnebago Industries is a leading producer of recreational vehicles in the United States. The motorhomes or RVs are made in the company’s vertically integrated manufacturing facilities in Iowa, while the travel trailer and fifth wheel trailers are produced in Indiana. Winnebago distributes its RV and marine products through independent dealers throughout the United States and Canada.
The company produces and sell conventional travel trailers and fifth wheels under the Winnebago and Grand Design brand names. It manufactures and sells Motorhomes under the Winnebago and Newmar brand names. Premium quality boats are built and sold under its Chris-Craft and Barletta brands through an established network of independent authorized dealers. It also manufactures other specialty commercial vehicles tailored for specific requirements, such as law enforcement command centers, mobile medical clinics, and mobile office space. These specialty commercial vehicles are built in Forest City and distributed through the firm’s dealer network.
On November 8, 2016, Winnebago acquired towable RV manufacturer Grand Design to expand the existing towable RV product offerings. With the acquisition, the company expanded the number of reporting segments to two: (1) Motorized products (constituting 44.7% of overall revenues in fiscal 2021) and services and, (2) Towable products and services (constituting 55.3% of overall revenues in fiscal 2021). The Motorized segment comprises of all products that include a motorized chassis as well as other related manufactured products. The Towable segment includes all products that are not motorized and are generally towed by another vehicle.
The recreational vehicle industry is influenced by many strong macroeconomic factors and is extremely sensitive to overall strength of the economy. The Global RV Market has enjoyed exponential growth since 2008 on the back of rising popularity of van life movement among millennials and changing customer lifestyles. The demand for RVs in luxury camping and travel amenities is likely to keep growing in the future.
Bottom Line
While anyone can invest, building a lucrative investment portfolio takes research, patience, and a little bit of risk. If you had invested in Winnebago Industries ten years ago, you’re probably feeling pretty good about your investment today.
A $1000 investment made in June 2012 would be worth $5,377.57, or a gain of 437.76%, as of June 28, 2022, according to our calculations. This return excludes dividends but includes price appreciation.
The S&P 500 rose 192.83% and the price of gold increased 11.17% over the same time frame in comparison.
Going forward, analysts are expecting more upside for WGO.
Winnebago has been riding on the strength of its acquisitions including Grand Design and Newmar, which have bolstered its product portfolio. The recreational vehicle (RV) maker has also fortified its marine market foothold on the acquisition of Barletta Pontoon Boats, which closed in August. The company’s balance sheet and investor friendly moves are praiseworthy. Winnebago’s all-electric e-RV camper van testifies its commitment toward innovation and sustainability. However, supply chain bottlenecks owning to shortage of RV components have impacted the margins. Escalating commodity and operating expenses may also weigh on the company’s performance. Additionally, rising interest rates and recessionary fears may result in demand reduction. Thus, the stock warrants a cautious stance as of now.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.