PATK - LCI Industries: Early Signs Of A Turnaround Are Encouraging

2024-02-07 07:42:49 ET

Summary

• LCI Industries, a producer and seller of components in the recreation, transportation, and housing markets, has faced difficulties in the past couple of years.
• The company's revenue for the third quarter of its 2023 fiscal year dropped by 15.3% compared to the previous year, with a significant decline in the OEM segment.
• Despite the challenges, management has been reducing leverage and the RV industry is showing signs of recovery, which could lead to an upgrade of the stock in the future.

One of the more interesting companies that I've come across in recent years is LCI Industries ( LCII ). For those not aware of the company, it is a producer and seller of components in the recreation, transportation, and housing markets. Although it does make its products available on the aftermarket, it mostly provides them to OEMs (original equipment manufacturers). A lot of the company's business involves the North American recreational vehicle market. And most of that involves RVs specifically, though it does also sell products associated with the boating market, buses, train space, and more. Over the years, the enterprise has grown to operate 120 manufacturing and distribution facilities spread throughout North America and parts of Europe. But unfortunately, the past couple of years have been rather difficult....

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