REV Group, Inc. (REVG) Hit a 52 Week High, Can the Run Continue?

Have you been paying attention to shares of REV Group (REVG)? Shares have been on the move with the stock up 11.1% over the past month. The stock hit a new 52-week high of $69.92 in the previous session. REV Group has gained 13.4% since the start of the year compared to the 13.6% move for the Zacks Auto-Tires-Trucks sector and the 15.9% return for the Zacks Automotive - Domestic industry.

What's Driving the Outperformance?

The stock has a great record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on December 10, 2025, REV Group reported EPS of $0.83 versus consensus estimate of $0.78 while it beat the consensus revenue estimate by 2.67%.

For the current fiscal year, REV Group is expected to post earnings of $3.72 per share on $2.66 in revenues. This represents a 37.78% change in EPS on a 8.12% change in revenues. For the next fiscal year, the company is expected to earn $4.69 per share on $2.89 in revenues. This represents a year-over-year change of 26.08% and 8.32%, respectively.

Valuation Metrics

While REV Group has moved to its 52-week high over the past few weeks, investors need to be asking, what is next for the company? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.

On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). The individual style scores for Value, Growth, Momentum and the combined VGM Score run from A through F. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.

REV Group has a Value Score of B. The stock's Growth and Momentum Scores are A and F, respectively, giving the company a VGM Score of A.

In terms of its value breakdown, the stock currently trades at 18.5X current fiscal year EPS estimates, which is a premium to the peer industry average of 14.9X. On a trailing cash flow basis, the stock currently trades at 21.9X versus its peer group's average of 8.7X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.

Zacks Rank

We also need to consider the stock's Zacks Rank, as this is even more important than the company's VGM Score. Fortunately, REV Group currently has a Zacks Rank of #1 (Strong Buy) thanks to favorable earnings estimate revisions from covering analysts.

Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if REV Group meets the list of requirements. Thus, it seems as though REV Group shares could have potential in the weeks and months to come.

How Does REVG Stack Up to the Competition?

Shares of REVG have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Ford Motor Company (F). F has a Zacks Rank of #1 (Strong Buy) and a Value Score of A, a Growth Score of B, and a Momentum Score of A.

Earnings were strong last quarter. Ford Motor Company beat our consensus estimate by 18.42%, and for the current fiscal year, F is expected to post earnings of $1.50 per share on revenue of $172.33 billion.

Shares of Ford Motor Company have gained 2.6% over the past month, and currently trade at a forward P/E of 9.12X and a P/CF of 4.34X.

The Automotive - Domestic industry is in the top 33% of all the industries we have in our universe, so it looks like there are some nice tailwinds for REVG and F, even beyond their own solid fundamental situation.

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This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research