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elkhartjim

Camping World 3rd Qtr Results

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I recently made a comment about Camping World being heading towards bankruptcy and it was aggressively refuted as only rumors , well their 3rd qtr results were announced after the market closed today and it doesn't look very good. Revenue up 6% and gross profit decreased 9.3%. CWH is burning through cash quickly. 

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CW just bought Gander and used a lot of cash to do so. If they are buying other companies I don’t think they would be on the verge of bankruptcy. 

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2 hours ago, txtiger said:

If they are buying other companies I don’t think they would be on the verge of bankruptcy. 

Not a comment on CW per say, but over-leveraging has brought down a number of  companies.

Bigger is not always better.

Depleting cash reserves can have the same result.

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I agree Jim, it's not a good sign for CW, however I bet you a donut that Marcus will make a ton of money, whether CW goes BK or not.

OldBeaver...Yep!  Don't want 2007-10 again!

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This is the link to the third quarter report for Camping World Holdings -->  https://investor.campingworld.com/press-releases/press-release-details/2017/Camping-World-Holdings-Inc-Reports-Third-Quarter-Results/default.aspx 

A key financial metric that "big oil"  (Chevron, ExxonMobil, my employer, etc.) carefully watch is "debt to equity" ratio which for the big oil companies is in the 25-30% range (i.e. total debt = 25-30% of total equity).   This debt to equity ratio is considered "healthy" for energy companies whose earnings are determined by commodity markets (i.e. cash margins are variable and not always predictable).   

Camping World Holdings has a whopping 90% debt to equity ratio which is very unhealthy ($2.1 Billion debt / $2.3 B equity).  If creditors came knocking at the door for full payment, Camping World would have to sell itself to pay creditors.   To build on Brett's and Old's comments, Camping World Holdings is not just "over leveraged" the company is "extremely leveraged".     Camping World's balance sheet looks like those of the many highly leveraged Exploration & Production companies in the Eagle Ford Shale area of south Texas that either went bankrupt or had to sell to a larger company to satisfy creditors.

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Hopefully the Affinity Group BOD will turn CW around. I suspect the Gander Mountain purchase was the defining factor in the upsidedown debt ratio.

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The lots in Colorado are absolutely packed with inventory. How does one go into winter months with few sales come out ahead. I think ever since Marcus has taken the rains it has been an insidious slide downward. Internet sales have taken a huge chunk out of retail sales. I agree with Brett and the others over leveraging has sunk many a ship.

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I certainly hope it has nothing to do with CEO Marcus shooting off his big mouth back in 2017!  Even though he didn't say exactly what was originally reported on the internet I still run into people swearing they won't step foot in a CW owned business as long as he is in charge.

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One quick look at the Camping World Holdings Balance Sheet and Cash Flow Statements will confirm the huge debt to equity ratio and just as importantly the cash flow to equity ratio and their cash to equity ratio. I started noticing a few months ago the emails with huge sales from Camping World that were coming in every other day it seemed and thats when I started looking at their financials. They need cash badly.  

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Carl, I still struggle with the whole NFL issue.  Two years ago I turned it off and swore I would never watch my Bears again because of what was happening.  This year I have watched a couple games but it isn't the same.   Just knowing a large percentage of the players, who have never had to defend this country, have zero respect for our flag has forever ruined my pro football experience.

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I can't imaging making $157 million over a 5 year period to be a quarterback (Seahawks).  No wonder it costs so much to go to a football game. I personally see no reason to support them if they cannot support what has been our traditions for over 200 years.

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On 11/12/2019 at 8:26 AM, manholt said:

Ray, try Affinity Group Holding, Inc.  est. 1916. 

Yep, that's why I said BOD=board of directors, they are the ultimate ruling body for any incorporated company.

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