PATK - LCI Industries: Not Ready For An Upgrade Just Yet

2024-06-26 13:10:48 ET

Summary

• LCI Industries' financial performance declined after a surge in demand during the COVID-19 pandemic, resulting in lower sales, profits, and cash flows.
• Despite recent improvements in profitability, the company is currently fairly valued but slightly pricey compared to similar firms in the industry.
• The company's first quarter results for 2024 show signs of improvement, with increased profits and cash flows, but it may be too early to upgrade the stock from a "hold" to a "buy."

I have always found myself interested in the recreational vehicle market. One of the companies that operates here, mostly as a supplier to OEMs (original equipment manufacturers), but also through the aftermarket, is LCI Industries ( LCII ). Ever since 2022 came to an end, the financial performance of the business has been on the decline. A surge in demand during the COVID-19 pandemic was, at least in part, the front loading of future years worth of demand for these types of vehicles. And now that the pandemic is clearly over, sales, profits, and cash flows, have all started to suffer as a result....

For further details see: