On Monday, I provided a short summary of my analysis of Thor Industries along with a trading idea to position for Thor’s likely earnings drop…
“Currently, the Thor Industries (THO) June 20, 2025 $100 puts are trading for $700 per contract. This options provides almost four months of time to allow the stock’s bear market trend to play out.”
That option is now trading at $20.30, a return of 190%.
Details of the pre-earnings analysis of Thor can be found here.
Today Thor Industries (THOR) dropped more than 15% following the company’s earnings report on Wednesday morning. The stock traded lower to the $80 price on its heaviest volume since March 6 2024.
Last quarter, Thor industries saw a decline in revenue of -8.6%. This made for the 10th consecutive quarter of shrinking sales as the RV manufacturer continues to face an abundance of supply and weaning demand following the pandemic.
Earnings per share for Thor’s second quarter were -$0.09 below Wall Street analysts’ target for the quarter marking the second quarter that the company has failed to hit its EPS targets.
Last March, Thor posted similar results as the stock had been trading at $125 ahead of its earnings release. Management gave forward-looking guidance that was lower than expectations after missing EPS and revenue targets.
A mirror image of today’s earnings results and price action as March 6 2024 saw the stock drop 15%.
Today, the stock dropped from $95 to its current price of $81.02 after bouncing at round number technical support from the $80 price.
Investors should be warned that the $80 is likely to give way to a target of $70.
Like March 2024, today’s support is likely to be temporary as investors and analysts continue to react to management’s outlook as well as the state of the economy.
Shares of THOR dropped another 8% over the seven days following the March 2024 example, and the stock is likely to repeat that performance with a price target of $70 over the short-term.
This week’s price performance has also sent Thor Industry shares into a new long-term bear market as the stock is now trading below its 20-month moving average.
Investors looking to take advantage of the short- and long-term bear market trends may consider looking at the options market as an opportunity to trade the trend.
The June 20, 2025, THO $80 puts currently trade for $650 per contract.
One of these put contracts would be valued at a minimum of $1,000 if the stock hits its $70 target before the June 20 expiration date. That move would return 53% at the prices quoted.
That option would be worth more than that if Thor Industry shares traded to that $70 price over the next month as the contract would still have roughly half of its time premium (roughly $3) remaining.
As always, investors are advised to consult with their advisor regarding the suitability of options trading as options trading involves certain risks. This article is for informational purposes only and does not constitute investment advice.
