Surging Earnings Estimates Signal Upside for Winnebago (WGO) Stock
Winnebago (WGO) shares have started gaining and might continue moving higher in the near term, as indicated by solid earnings estimate revisions.
Winnebago Industries (WGO) could be a solid addition to your portfolio given a notable revision in the company's earnings estimates. While the stock has been gaining lately, the trend might continue since its earnings outlook is still improving.
The upward trend in estimate revisions for this recreational vehicle maker reflects growing optimism of analysts on its earnings prospects, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. This insight is at the core of our stock rating tool -- the Zacks Rank.
The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.
For Winnebago, strong agreement among the covering analysts in revising earnings estimates upward has resulted in meaningful improvement in consensus estimates for the next quarter and full year.
The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate:
12 Month EPS
Current-Quarter Estimate Revisions
For the current quarter, the company is expected to earn $3.03 per share, which is a change of +42.92% from the year-ago reported number.
Over the last 30 days, five estimates have moved higher for Winnebago compared to no negative revisions. As a result, the Zacks Consensus Estimate has increased 26.27%.
Current-Year Estimate Revisions
For the full year, the company is expected to earn $12.30 per share, representing a year-over-year change of +43.86%.
There has been an encouraging trend in estimate revisions for the current year as well. Over the past month, five estimates have moved up for Winnebago versus no negative revisions. This has pushed the consensus estimate 30.84% higher.
Favorable Zacks Rank
Thanks to promising estimate revisions, Winnebago currently carries a Zacks Rank #1 (Strong Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.
Winnebago shares have added 5.2% over the past four weeks, suggesting that investors are betting on its impressive estimate revisions. So, you may consider adding it to your portfolio right away to benefit from its earnings growth prospects.
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Winnebago Industries, Inc. (WGO): Free Stock Analysis Report
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