DA Davidson analysts upgraded shares of Camping World (NYSE:CWH) and Lazydays Holdings, Inc. (NASDAQ:LAZY) to BUY from Neutral in a note Friday, following the firm's recent RV checks.
The analysts also lifted the CWH price target to $36, while LAZY's was moved to $14 per share as DA Davidson takes a more favorable view on RV retailers.
"We believe both dealership chains are outperforming the broader RV industry on inventory health, profitability and used RV sales," they wrote.
"Their proactive approach to clearing MY22 inventory has left these retailers in a position to take advantage of attractive MY23 OEM discounts, which should lead to improved 2H23 new vehicle margins. Our most recent inventory data scrape revealed that both CWH (11.5%) and LAZY (6.0%) were both outpacing the top dealership chains (13.1%)," they added.
The analysts also noted that used RV sales remain strong as customer preference continues to shift towards cheaper options, while June new RV sales show minimal improvement compared to May but are still trending below 2019 levels.