Rev Group shares are down 22% on Wednesday: this is why

Shares of Rev Group Inc (NYSE: REVG) are down 22% this morning on weaker-than-expected results for its fiscal fourth quarter.

Q4 results

Rev Group reported $17.9 million in adjusted net income that translates to 27 cents per share. The Wisconsin-based company generated $589.9 million in revenue. In comparison, analysts had forecast 29 cents of adjusted EPS on $600.72 million in sales.

In the same quarter last year, Rev Group had posted $616.3 million in revenue and 19 cents of per-share earnings on an adjusted basis.

The NYSE-listed company valued backlog at $3.1 billion at the end of Q4, thanks to strong demand across all segments. Earlier this week, Rev Group signed additional agreements for electric ambulances.

Full-year performance

Rev Group reported $2.38 billion in sales for the full year on $76.9 million in adjusted net income. Cash from operating activities climbed to a record $158.3 million this year, and net debt came down by $129.1 million. In the earnings press release, CEO Rod Rushing said:

Future outlook

For fiscal 2022, Rev Group now forecasts up to $73 million in net income on $2.3 billion to $2.55 billion in net sales.

According to the manufacturer of ambulances and other speciality vehicles, it had $13.3 million in cash and equivalents at the end of the fourth quarter. Rev Group spent $10.8 million in Q4 – an increase from $3.8 million last year. It repurchased $3.9 million worth of its common shares in the recent quarter.