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Shares of Camping World (CWH 19.74%), the world's largest seller of recreational vehicles (RVs), were moving lower today after the company topped estimates in its third-quarter earnings report, but said that it had identified some accounting misstatements from a year ago, which is often a red flag for investors. As a result, the stock was down 18.5% as of 9:54 a.m. ET. What's happening with Camping World? The results for the quarter were solid, with revenue up 4.7% to $1.81 billion, which was ahead of the consensus at $1.75 billion. New-vehicle revenue was down 7% to $766.8 million, but used-vehicle revenue picked up the slack, rising 31.7% to $141.9 million. Same-store unit sales increased 15.6%, a positive sign for the business, and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) rose 28.2% to $95.7 million. On the bottom line, adjusted earnings per share jumped from $0.13 to $0.43, ahead of the consensus at $0.32. The real problem in the report seemed to come from the misstatement issue, as the company said it undercounted deferred tax assets, leading to a restatement of the balance sheet a year ago that increased deferred tax assets by $43.8 million. It also raised retained earnings by $10.4 million and additional paid-in capital by $33.4 million. What's next for Camping World? The RV seller didn't offer guidance, but the accounting misstatements and complexity in its financial reporting, along with the decline in new vehicle sales, seem to have sparked a sell-off. While the business appears to have stabilized following the post-pandemic hangover, it may take some time to repair investor trust, even though the misstatement was relatively minor.
