REV Group, Inc. (REVG) | Investment Case

1. Company Snapshot

1.a. Company Description

REV Group, Inc.designs, manufactures, and distributes specialty vehicles, and related aftermarket parts and services in the United States, Canada, Europe, Africa, and internationally.It operates through three segments: Fire & Emergency, Commercial, and Recreation.

The Fire & Emergency segment provides fire apparatus equipment under the Emergency One, Kovatch Mobile Equipment, Ferrara, Spartan Emergency Response, Smeal, and Ladder Tower brands; and ambulances under the American Emergency Vehicles, Horton Emergency Vehicles, Leader Emergency Vehicles, Road Rescue, and Wheeled Coach brands.The Commercial segment offers transit buses, type A school buses, sweepers, and terminal trucks under the Collins Bus, Capacity, ENC, and Lay-Mor brands.The Recreation segment offers motorized and towable RV models under the American Coach, Fleetwood RV, Holiday Rambler, Renegade, Midwest, and Lance brands; and produces a range of custom molded fiberglass products for the heavy-duty truck, RV, and broader industrial markets.

The company sells its products to municipalities, government agencies, private contractors, consumers, and industrial and commercial end users through its direct sales force or dealer network.The company was formerly known as Allied Specialty Vehicles, Inc.and changed its name to REV Group, Inc.

in November 2015.REV Group, Inc.is based in Brookfield, Wisconsin.

Show Full description

1.b. Last Insights on REVG

The recent 3-month performance of REV Group, Inc. was negatively impacted by the transportation sector's underperformance. Despite strong Q1 earnings and revenue beat, the company's stock has lagged its peers. The RV segment's weakness, partly offset by the specialty vehicle segment's growth, contributed to the mixed performance. Additionally, the company's high backlog and industry consolidation in the specialty vehicle segment may not be enough to offset the RV segment's challenges.

1.c. Company Highlights

Last Price	56.77
Change Percentage	-0.05%
Open	56.98
Previous Close	56.8
Market Cap ( Millions)	2771
Volume	240603
Year High	64.47
Year Low	26.51
M A 50	54.85
M A 200	45.43

FCF Yield	7.21%
Dividend Yield	0.42%
ROE	26.85%
Debt / Equity	27.83%
Net Debt / EBIDTA	39.30%
Price To Book	7.1
Price Earnings Ratio	25.47
Price To FCF	13.87
Price To sales	1.15
EV / EBITDA	15.54

2. REV Group's Q3 FY2025 Earnings: Strong Performance and Strategic Initiatives

REV Group reported a robust Q3 FY2025, with net sales reaching $644.9 million, up 11.8% year-over-year. Adjusted EBITDA increased to $64.1 million from $45.2 million in Q3 FY2024. Earnings per share (EPS) came in at $0.79, beating analyst estimates of $0.63. The company's strong performance was driven by operational improvements, including lean manufacturing and process innovation, which led to an 11% increase in fire unit shipments and a 7% rise in ambulance shipments.

Publication Date: Sep -08

                                    📋 Highlights
                                    M&A Strategy:
                                                Company remains opportunistic and disciplined, prioritizing strategic, accretive acquisitions over growth-at-all-costs.
Market Conditions:
                                                Acknowledges limited opportunities in its sector but maintains readiness to act on short-term prospects.
Process Focus:
                                                Requires deals to enhance quality processes developed over the past three years, ensuring alignment with existing portfolio.
Deal Caution:
                                                No guarantees of immediate M&A activity; emphasizes evaluating opportunities systematically without overextending.
Investor Outlook:
                                                Investors should expect measured participation in M&A, with no forced purchases in a constrained environment.

                                

Segment Performance

The Recreational Vehicle (RV) segment saw sales rise 9.7% to $161.7 million, despite macroeconomic challenges and tariffs on imported luxury vans. However, adjusted EBITDA for the segment declined 13.8% to $8.1 million. The Specialty Vehicles segment, on the other hand, reported adjusted EBITDA of $64.6 million, a 71.4% increase year-over-year.

Valuation and Future Outlook

With a current P/E Ratio of 27.93 and EV/EBITDA of 17.0, the market has priced in significant growth expectations. Analysts estimate revenue growth at 7.4% for the next year. REV Group has raised its full-year guidance, with consolidated revenue now expected to be between $2.4 billion and $2.45 billion, and adjusted EBITDA between $220 million and $230 million. The company's strategic priorities include reinvesting in operations, share repurchases, and M&A opportunities.

Cash Flow and Capital Deployment

REV Group generated strong cash flow, with $60.3 million in Q3 and $164.7 million year-to-date. The company has a liquidity cushion of $247.2 million under its ABL facility. Management prioritizes business investments, including capacity expansion and efficiency initiatives, while also considering opportunistic M&A deals that are accretive to its existing portfolio.

3. NewsRoom

REV Group to Release Fourth Quarter 2025 Earnings on Wednesday, December 10, 2025

Dec -04

Source: businesswire.com

Here Are Monday’s Top Wall Street Analyst Research Calls: Archer Aviation, Beta Technologies, Carvana, Chevron, MPLX, Toast, Zscaler and More

Dec -01

Source: 247wallst.com

REV Exploration To Acquire Mining Claims, Grants Options

Nov -27

Source: thenewswire.com

Is REV Group (REVG) Stock Outpacing Its Auto-Tires-Trucks Peers This Year?

Nov -26

Source: zacks.com

REV Group Announces Expansion Investment in Horton Emergency Vehicles to Increase Capacity

Nov -13

Source: businesswire.com

Is REV Group (REVG) Outperforming Other Transportation Stocks This Year?

Nov -06

Source: zacks.com

$HAREHOLDER ALERT: The M&A Class Action Firm Announces An Investigation of REV Group, Inc. (NYSE: REVG)

Nov -04

Source: prnewswire.com

REVG Stock Alert: Halper Sadeh LLC is Investigating Whether the Sale of REV Group, Inc. is Fair to Shareholders

Nov -03

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.63%)

6. Segments

Fire & Emergency

Expected Growth: 4.65%

REV Group's Fire & Emergency segment growth of 4.65% is driven by increasing demand for emergency vehicles, favorable government funding for fire departments, and a growing need for emergency response services. Additionally, the company's strategic acquisitions and investments in product innovation, such as electric and hybrid vehicles, are contributing to its growth momentum.

Recreation

Expected Growth: 8.5%

REV Group's Recreation segment growth of 8.5% is driven by increasing demand for RVs and outdoor recreational vehicles, fueled by rising consumer spending, low interest rates, and a growing desire for experiential travel. Additionally, the company's strategic acquisitions and investments in innovative products have expanded its market share and improved operational efficiency.

Commercial

Expected Growth: 7.77%

REV Group's commercial segment growth of 7.77% is driven by increasing demand for buses and ambulances, strategic acquisitions, and expansion into new markets. Additionally, the company's focus on innovation, quality, and customer service has led to market share gains and higher sales volumes.

Corporate, Other & Elims

Expected Growth: 4.83%

REV Group's 4.83% growth is driven by Corporate segment's focus on cost savings and operational efficiency, Other segment's growth in aftermarket parts and services, and Eliminations' reduction in intercompany transactions. Additionally, the company's strategic acquisitions and investments in electric vehicle technology have contributed to the overall growth.

7. Detailed Products

Fire Trucks

REV Group's fire trucks are designed for firefighting and rescue operations, equipped with advanced technology and safety features.

Ambulances

REV Group's ambulances are designed for emergency medical services, providing safe and reliable transportation for patients.

Recreational Vehicles

REV Group's recreational vehicles offer luxury and comfort for travelers, with features like spacious interiors and advanced amenities.

Commercial Buses

REV Group's commercial buses provide safe and reliable transportation for passengers, with options for transit, tour, and shuttle services.

Terminal Trucks

REV Group's terminal trucks are designed for cargo handling and transportation, with features like heavy-duty lifting capacity and advanced safety features.

Street Sweepers

REV Group's street sweepers are designed for efficient and effective street cleaning, with features like advanced filtration systems and ergonomic design.

8. REV Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

REV Group, Inc. operates in a niche market with specialized products, reducing the threat of substitutes. However, the company's reliance on a few key suppliers increases the threat of substitutes.

Bargaining Power Of Customers

REV Group, Inc.'s customers are primarily government agencies and large corporations, which have limited bargaining power due to the specialized nature of the company's products.

Bargaining Power Of Suppliers

REV Group, Inc. relies on a few key suppliers for critical components, giving these suppliers significant bargaining power.

Threat Of New Entrants

The specialized nature of REV Group, Inc.'s products and the high barriers to entry in the industry reduce the threat of new entrants.

Intensity Of Rivalry

REV Group, Inc. operates in a competitive industry, but the company's diversified product portfolio and strong brand recognition help to mitigate the intensity of rivalry.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	27.34%
Debt Cost	12.05%
Equity Weight	72.66%
Equity Cost	12.05%
WACC	12.05%
Leverage	37.63%

11. Quality Control: REV Group, Inc. passed 6 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Inefficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Lindsay

A-Score: 6.0/10

Value: 5.3

Growth: 6.4

Quality: 6.7

Yield: 2.0

Momentum: 7.0

Volatility: 8.3

1-Year Total Return ->

Alamo Group

A-Score: 5.8/10

Value: 5.2

Growth: 7.1

Quality: 6.6

Yield: 1.0

Momentum: 6.0

Volatility: 8.7

1-Year Total Return ->

REV Group

A-Score: 5.8/10

Value: 4.1

Growth: 6.2

Quality: 6.3

Yield: 4.0

Momentum: 10.0

Volatility: 4.0

1-Year Total Return ->

Wabash

A-Score: 4.9/10

Value: 9.6

Growth: 3.3

Quality: 6.5

Yield: 6.0

Momentum: 0.5

Volatility: 3.3

1-Year Total Return ->

Hyster-Yale

A-Score: 4.9/10

Value: 7.0

Growth: 6.4

Quality: 3.6

Yield: 7.0

Momentum: 0.5

Volatility: 4.7

1-Year Total Return ->

Gencor

A-Score: 3.9/10

Value: 5.3

Growth: 7.4

Quality: 6.0

Yield: 0.0

Momentum: 0.5

Volatility: 4.3

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

15.03%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

12.05%

REV Group, Inc. - US7495271071

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on REVG

1.c. Company Highlights

Higher Yield

Strong Momentum

Higher Growth

Earnings Beats

Revenues Beats

Average Quality

Revenues Miss

Medium Volatility

Average Growth

Average Yield

Stable Momentum

Fairly Valued

2. REV Group's Q3 FY2025 Earnings: Strong Performance and Strategic Initiatives

Segment Performance

Valuation and Future Outlook

Cash Flow and Capital Deployment

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.63%)

6. Segments

Fire & Emergency

Expected Growth: 4.65%

Recreation

Expected Growth: 8.5%

Commercial

Expected Growth: 7.77%

Corporate, Other & Elims

Expected Growth: 4.83%

7. Detailed Products

Fire Trucks

Ambulances

Recreational Vehicles

Commercial Buses

Terminal Trucks

Street Sweepers

8. REV Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: REV Group, Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

56.77$

Current Price

56.77$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA