REV Group (REVG) AI Stock Analysis

• Market Cap: $2.33B
• Dividend Yield: 0.48%
• Average Volume (3M): 624.19K
• Price to Earnings (P/E): 25.6
• Beta (1Y): 1.38
• Revenue Growth: -9.50%
• EPS Growth: -54.36%
• Country: US
• Employees: 5,500
• Sector: Industrials
• Sector Strength: 94
• Industry: Agricultural - Machinery
• EPS (TTM): 0.70
• Shares Outstanding: 48,797,350
• 10 Day Avg. Volume: 622,303
• 30 Day Avg. Volume: 624,192
• PEG Ratio: 4.86
• Price to Book (P/B): 6.70
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 14.65
• Enterprise Value/Market Cap: 1.05
• Enterprise Value/Revenue: 0.26
• Enterprise Value/Gross Profit: 7.57
• Enterprise Value/Ebitda: 3.84
• 1Y Price Target: $45.00
• Price Target Upside: -5.64% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 3

• Rating: 78 Outperform
• Price Target: $53.00 ▲(11.13%Upside)

REV Group's overall stock score reflects strong financial performance and positive earnings call sentiment, driven by improved profitability and strategic initiatives like share repurchases. The technical analysis supports a bullish trend, although valuation metrics suggest the stock might be overvalued. Attention to revenue challenges and strategic exits will be crucial for future performance.

Positive Factors

Financial Performance

REV Group's F2Q25 earnings beat expectations and raised FY25 Adjusted EBITDA outlook at the midpoint, suggesting strong company performance.

Share Repurchase

The company repurchased over 5% of its outstanding shares, indicating robust financial health and confidence in its stock value.

Stock Upgrade

REV Group is being upgraded to Equal-weight due to better than expected price/cost dynamics and strong product demand.

Negative Factors

Adjusted EBITDA Estimates

There is a reduction in the FY25 Adj. EBITDA estimate from $204M to $202M.

Financial Risk

There is potential financial risk to REVG from tariffs, particularly given the fixed nature of contracts that historically made it difficult for the company to pass through costs real time.

REV Group Business Overview & Revenue Model

Company Description

REV Group, Inc. (REVG) is a leading American manufacturer of specialty vehicles serving diverse markets, including emergency, commercial, and recreation sectors. The company designs, produces, and sells a wide range of vehicles such as ambulances, fire trucks, school buses, shuttle buses, and RVs (recreational vehicles). REV Group operates through a portfolio of well-known brands, providing innovative and reliable vehicle solutions tailored to meet the specific needs of its customers.

How the Company Makes Money

REV Group generates revenue through the manufacturing and sale of specialty vehicles across multiple segments. Key revenue streams include the sale of emergency vehicles like ambulances and fire trucks, commercial vehicles such as buses and vans, and recreational vehicles like motorhomes. The company also earns from aftermarket parts and service offerings, providing maintenance and repair services for its vehicles. Significant partnerships with government agencies, municipalities, and commercial enterprises bolster its sales, while its diverse product lineup helps mitigate risks associated with market fluctuations in any single sector.

REV Group Financial Statement Overview

Summary

REV Group exhibits a strong financial position with notable improvements in profitability, leverage, and cash management. The company has managed to enhance its margins and cash flows despite some revenue volatility. The balance sheet has improved in terms of leverage, though the decline in stockholders' equity and revenue challenges need to be addressed for sustained financial health.

Income Statement

REV Group shows strong profitability with a consistent increase in gross profit margin, reaching 13.8% in TTM (Trailing-Twelve-Months) from 10.6% in 2022. Net profit margin improved significantly over the years, from a negative in 2020 to 4.2% in TTM. Revenue growth has been somewhat volatile, but overall, profitability metrics indicate a positive trajectory. However, the recent TTM revenue was slightly lower than past years, indicating some revenue challenges.

Balance Sheet

The balance sheet demonstrates a stable equity ratio at 29.1% in TTM, although slightly down from previous years, indicating moderate financial stability. The debt-to-equity ratio improved to 0.43, down from 0.79 in 2020, suggesting better leverage management. Return on equity shows improvement with 27.1% in TTM, highlighting enhanced return capabilities. However, the reduction in stockholders' equity over the years poses potential risk.

Cash Flow

Cash flow analysis reveals a robust operating cash flow to net income ratio of 1.93 in TTM, indicating strong cash generation relative to profits. Free cash flow has grown significantly, with a TTM free cash flow of $159.4 million compared to $66.8 million in 2022, reflecting effective cash management. However, the fluctuation in free cash flow growth suggests some variability in cash generation capabilities.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.38B	2.64B	2.33B	2.38B	2.28B
Gross Profit	297.30M	316.10M	247.50M	291.00M	228.10M
EBITDA	394.30M	113.00M	69.00M	120.10M	19.80M
Net Income	257.60M	45.30M	15.20M	44.40M	-30.50M
Balance Sheet
Total Assets	1.21B	1.41B	1.34B	1.24B	1.31B
Cash, Cash Equivalents and Short-Term Investments	24.60M	21.30M	20.40M	13.30M	11.40M
Total Debt	118.00M	187.40M	250.30M	234.90M	367.50M
Total Liabilities	777.90M	912.40M	888.30M	719.50M	840.00M
Stockholders Equity	435.10M	498.00M	456.30M	518.80M	472.30M
Cash Flow
Free Cash Flow	25.80M	93.70M	66.80M	133.60M	38.90M
Operating Cash Flow	53.40M	126.50M	91.60M	158.30M	55.70M
Investing Cash Flow	348.50M	-29.90M	-14.80M	-10.20M	1.70M
Financing Cash Flow	-398.60M	-95.70M	-69.70M	-146.20M	-49.30M

REV Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 47.69
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For REVG, the sentiment is Positive. The current price of 47.69 is below the 20-day moving average (MA) of 47.94, above the 50-day MA of 43.75, and above the 200-day MA of 34.36, indicating a neutral trend. The MACD of 0.91 indicates Positive momentum. The RSI at 58.49 is Neutral, neither overbought nor oversold. The STOCH value of 50.73 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for REVG.

REV Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
REVG	78 Outperform	$2.33B	25.57	34.41%	0.48%	-9.50%	-54.36%
OSK	77 Outperform	$8.23B	13.66	15.24%	1.52%	5.95%	-10.59%
HY	74 Outperform	$775.15M	7.79	21.56%	3.29%	-0.32%	-35.10%
Sector *	65 Neutral	$11.06B	15.73	5.16%	1.93%	3.12%	-25.59%
ASTE	63 Neutral	$906.90M	60.42	2.33%	1.31%	1.99%	-39.02%
WNC	49 Neutral	$454.71M	―	-15.01%	3.00%	-25.44%	-135.47%

REV Group Corporate Events

REV Group Reports Strong 2024 Results and 2025 Outlook

REV Group, Inc. has announced its robust fiscal 2024 fourth-quarter and full-year results, highlighting a net income increase and strong overall performance despite a decrease in consolidated net sales. The company is optimistic about fiscal 2025 with new financial targets, a $250 million share repurchase authorization, and a 20% increase in quarterly cash dividends, showcasing its commitment to returning value to shareholders and maintaining financial health.