Analysts Pitch Tent Over Camping World

Camping World Holdings Inc (NYSE: CWH), a marketer of specialty recreation vehicle and outdoor camping accessories and services, debuted on the New York Stock Exchange on October 7 at a listing price of $23.75, up from the offer price of $22 per share. The stock managed to close at $22.50, above the offer price by 2.27 percent.

Since then, the stock's performance has been so-so, as it traded on either side of the offer price. With the quiet period now quietly out of the way, sell-side analysts are making noise concerning the company.

An Initiations' Sneak-Peek

• Baird: Outperform, $27 target price.
• Credit Suisse: Outperform, $28 target price.
• Goldman Sachs: Neutral, $24 target price.
• KeyBanc Capital Markets: Overweight, $28 target price.

Analysts' Investment Thesis

Baird Expects Camping World To Trade At Premium To RV OEMs

• Over time, Baird expects Camping World to trade at a premium to RV OEMs, just as auto dealers trade higher.
• Given the superior margins and a richer mix of recurring profits, the firm expects the company to trade at a premium to auto dealers.
• Baird sees it as a foremost consolidator.

Camping World Is One Of The Attractive Stories In Consumer Space –Credit Suisse

• The firm said it sees Camping World as a story with above-average store growth, offering a high service recurring revenue model, strong management and low valuation, making it one of the most attractive stories in the consumer space.

Goldman Weighs Roll-Up Strategy Vs. Cycle Concerns

• Goldman sees a favorable industry backdrop, allowing the company to add top line and EBITDA growth through M&A.
• However, the firm believes the company's multiple is likely to take a hit from a deceleration in industry shipment growth.
• That said, the firm expects the weakness to be countered by the company's highly variable cost business model.

KeyBanc Sees Opportunity For Share Price Upside

• The firm sees opportunity to share price upside, given its view that there is little spread between Camping World and the RV manufacturers' valuation, relative to the auto and marine groups.
• Analyst Scott Hamann premised his Overweight rating on the strong growth outlook and conservative estimates.
• The company's leverage to a high margin/recurring revenue stream, according to the analyst, would give some relative cushion to business cyclicality.

At time of writing, shares of Camping World were down 0.40 percent at $22.27.