Markets

Boomers and millennials love RVs and that's sending Thor Industries stock blitzing higher

Key Points
  • Shares of Thor Industries are soaring towards the company's best day in over five years.
  • CEO Bob Martin says "Baby Boomers, Gen-X'ers and Millennials" alike are attracted to RV market.
  • Thor's most recent quarter "came in much stronger-than-expected by nearly any metric," SunTrust analyst Michael Swartz wrote in a note.
A factory worker installs rivets into the roof of an Airstream Inc. RV travel trailer on the production line at the company's assembly plant in Jackson Center, Ohio.
Luke Sharrett | Bloomberg | Getty Images

Shares of Thor Industries soared over 13 percent in midday trading Tuesday after the RV builder reported robust earnings and upped its future expectations.

Thor's record EPS of $2.43 for first quarter 2018 crushed Wall Street's expectations by 59 cents. The company's stock is on track to have its best day since Aug. 3, 2012, when Thor closed up more than 13 percent.

"The breadth of our offerings … are attracting an ever-wider array of customers, including Baby Boomers, Gen-X'ers and Millennials, to take part in the RV-lifestyle," CEO Bob Martin said in a statement.

The recreational vehicle maker is seeing demand for its towable products continue to rise, as well as for its motorized vehicles. Martin credits this to the overall industry's demand remaining "exceedingly strong," saying he sees the growth continuing "for the foreseeable future."

Kayne Anderson Rudnick analyst Chris Wright told CNBC that Martin is right: lightweight, cheaper towable products combined with an increase in younger buyers — both millennials and new families alike — have "been the big driver for the past few years in the industry."

"National parks' visitation statistics are exemplary of this: since 2014, on an aggregate, the amount of visitation is hitting all-time highs every single year," Wright said. "That strong uptick has tracked along with Thor's results."

SunTrust analyst Michael Swartz wrote in a note Tuesday that Thor's quarter "came in much stronger-than-expected by nearly any metric." With a buy rating on Thor's stock, Swartz also says the current momentum will continue, while raising SunTrust's price target on the shares to $165.

Thor stock has risen nearly 52 percent this year, trading at over $152 a share on Tuesday.