REVG - Embedded Expectations Analysis - 2018 06 20
ï€ REV Group, Inc. (REVG:USA) currently trades below corporate average valuations relative to UAFRS-based (Uniform) Earnings, with a 10.4x Uniform P/E, implying bearish expectations for the firm. Moreover, management has concerns about costs, sales mix, and demandï€ Specifically, management may be concerned about their increasing costs, driven by tariff concerns, and may also be concerned about their unfavorable sales mix during the quarter. Furthermore, they may be downplaying concerns about their profitability in the RV market, and may lack confidence in the sustainability of strong demand in the fire and ambulance markets driving growth in their Fire & Emergency business. Moreover, they be exaggerating their momentum going into 2019 given their current backlog, and may lack confidence in the sustainability of fixed overhead reductions in their factories
REV Group is a holding company. Through its subsidiaries, the company is a designer, manufacturer and distributor of specialty vehicles and related aftermarket parts and services. The company provides customized vehicle solutions for applications including: essential needs (ambulances, fire apparatus, school buses and municipal transit buses), industrial and commercial (terminal trucks, cut-away buses and sweepers) and consumer leisure (recreational vehicles (RVs), and coaches). The company's segments are: Fire and Emergency, which sells fire apparatus equipment and ambulances; Commercial, which produces buses, terminal trucks and sweepers; and Recreation, which provides motorized and towable RV models.
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