Camping World Holdings [CWH]: The Empire Will Strike BackThesis:
Marcus Lemonis, CEO, is taking full advantage of the RV cycle to acquire market share via a well executed and accretive M&A strategy. Market share for new units has expanded from 15% to 20% in less than five years and combined new and used stands at 11%. Scale matters in this business creating several durable advantages: pricing power, private label product, geographic and price point diversification, and cost of capital. 1H2025 is lining up to be pivotal in terms of both revenue growth and positive earnings.
Pro's:
1. Strong CEO and management team that knows the business and is executing well
2. Market share growth via accretive M&A
3. Revenue and earnings will scale with recovery
4. Strong and growing institutional ownership
Con's:
1. Increase in debt (for M&A) puts stress on liquidity and debt ratios
2. Interest rate environment, stagnant housing market, and consumer recession risks continue until further notice
3. PMI risk of operational disruption or management distraction due to extensive merger integrations
Technical Setup:
A constructive base in the stock is forming with clearly defined areas of support and resistance using Anchored VWAP analysis (see profile link for more on Five Lines Analysis). A break above $25 with volume would increase the probability of a longer term price move.
Disclosure: I am long CWH and may add to or reduce at any time. Not Investment Advice. Do your own due diligence.
CWH trade ideas
CWH: Monthly Bat/Crab ConfluencesCamping World Holdings, Inc. operates as a retailer of recreational vehicles (RV) and related products and services. It operates through the following segments: protecting, insuring, and promoting the RV lifestyle and RV & Outdoor Retail. CWH has a Medium STRONG quantitative fundamental score (Greater than 6) with great analyst prospects (Strong Buy and Hold ratings). Furthermore, CWH has a VERY GOOD dividend pay out @ 1.19 per share/year (Approximately 8.8 - 9.67% of the entry range a 13.51 - 12.30). Therefore, this CWH long play has GREAT value at the price levels from 13.51 - 12.30.
In this idea, we have a crab and bat-pattern with a smaller deep-crab recently formed in the right arm, showing us that price should reverse between 13.51 - 12.30. I expect price to have a long-term reversal within this range. I would average into this position with a 3% stop below 12.30. Once the 0.382 target is acquired, I would sell half of my position and set stop-loss runners to trail price by the 'Average True Range' of multiple timeframes. Once price has reached the 0.618 target, I would sell the other half of my position. The first target nets 95.4 -114% (Risk-to-Reward of 31.46) and the second target nets 160 - 185% (Risk-to-Reward of 52.68). Averaging these percentage gains out and adding for the dividend (I would expect to hold this for at least one year), one would profit approximately 148% of their original investment.
Plugging in the probability for success of a deep-crab pattern and the R:R values into our Kelly Criterion betting calculator for an account of $1000, we get;
FIRST TARGET
Probability: 0.93
Odds: 31.46
Bankroll:$1000
Calculation:
Kelly Criterion (Adjusted) - 0.9278
Bet This Much (Adjusted) - $927.77
SECOND TARGET
Probability: 0.93
Odds: 50.27
Bankroll:$1000
Calculation:
Kelly Criterion (Adjusted) - 0.9287
Bet This Much (Adjusted) - $928.67
Therefore, one should bet approximately 92.7% - 92.8% of their normal lot size. Good luck and trade safely!
CWH Bearish inclined naked calls 17 June expiry
Whats The Plan/Trade/Thought
CWH is part of the Recreational Vehicles sector, that came out of my shortlist of companies with medium level volatility in the past month
Across the sector there is a bearish alignment which is important
I do expect some volatility with an upwards movement as price across the markets might stabilise from the past 5 weeks of back to back drops
Risk Mitigation
Very clear S&R lines. If price breaks S&R 1, I will have to close the trade.
I Feel
I feel confident about this trade as I will be using my S&R lines as a risk mitigator.
Imagine Yourself Taking The Other Side
With the bearish price action from the past 5 weeks, selling puts would be too risky and almost as if you are trying to guess the bottom
Look For New Information
Dividends is happening on the 13 June. But I have not seen this event result in volatility
How Do I Feel Now
Good, I’m clear
Trade Specs
Sold 236 Calls @ 0.25 - Strike 34
23.6% to Strike
BP Used 66.9K
Max Gain $5,900
CWH (Camping World) - Another Bullish Quarter Ahead?Camping World Holdings Inc.
Camping World Holdings, Inc. is a provider of services, protection plans, products and resources for recreational vehicle enthusiasts. The company's brand consists of Camping World and Good Sam. It offers new and used RVs for sale, vehicle service and maintenance through retail locations and membership clubs. Camping World Holdings, Inc. is based in Lincolnshire, United States.
Analysis/Commentary
Strong EPS and Sales Growth Y-on-Y
Based on the study of the previous quarterly earnings reports and subsequent price moves:
- A good earnings quarter, positive growth
- Next earnings quarter pending, expect continued growth from previous EPS & Sales
- Expectation for the price to move to MID point
- Trailing stop-loss on price above MID point
GOOD LUCK.
DO YOUR OWN RESEARCH!