Shares of Winnebago Industries Inc. and Thor Industries Inc. rose on Monday after an analyst upgraded shares of the recreational vehicle manufacturers, citing signs of improvement in the RV market.
Shares of Winnebago soared $1.40, or 10.3 percent, to $15 in midday trading. Shares of Thor jumped $2.33, or 7.4 percent, to $34 amid a rally in the broader market.
Baird analyst Craig Kennison raised his ratings on Winnebago and Thor to "Outperform" from "Neutral" in a note to investors on Monday. He said the RV market is now in "correction mode."
RV sales have been sluggish in recent years as discretionary spending dropped and the credit markets locked up. But those trends have begun to reverse, Kennison said.
"Our checks confirm low inventory, robust orders, better traffic, easier credit and improved retail — supporting a bullish stance," Kennison wrote.
In March, Winnebago reported it moved to a profit in its fiscal second quarter as its revenue tripled. Thor reported a return to profitability during the same period, too.
Shares of Winnebago have climbed 11 percent so far this year. Thor shares are flat but have nearly doubled from a low of $16.65 set last July.