Winnebago Industries Shares Fall After Downgrade

NEW YORK (AP) — Winnebago Industries Inc. fell Friday after an analyst downgraded shares on concerns the nation's top motor home maker will struggle to earn money next year as the entire sector experiences a comparatively slow recovery.

Baird analyst Craig R. Kennison downgraded the shares to "Underperform" from "Neutral," saying the recovery in motor homes has lagged that of companies that make towable recreational vehicles.

Also, motor home manufacturing capacity has not fallen as the analyst had expected, and Forest City, Iowa-based Winnebago will struggle to achieve profitability in fiscal 2010.

For the fiscal 2009 fourth quarter, which Winnebago reports Oct. 15, Kennison forecast a loss of $7 million to $8 million on revenue of about $65 million.

Longer term the analyst is more sanguine about the company's prospects, noting that dealer inventories are low and retail is poised for recovery.

Kennison has an $11 price target on shares of the company, which holds a 19 percent share of the nation's $3 billion motor home market.

In morning trading the stock fell 85 cents, or 5.9 percent, to $13.54.