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Cavco Industries (CVCO)
NASDAQ:CVCO
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Cavco Industries
(NASDAQ:CVCO)
82Outperform
Cavco Industries (CVCO) vs. S&P 500 (SPY)
Market Cap
$3.81B
Dividend YieldN/A
Average Volume (3M)70.78K
Price to Earnings (P/E)23.4
Beta (1Y)1.04
Revenue Growth4.09%
EPS Growth3.14%
CountryUS
Employees6,500
SectorConsumer Cyclical
Sector Strength61
IndustryResidential Construction
Share Statistics
EPS (TTM)20.31
Shares Outstanding8,013,148
10 Day Avg. Volume80,003
30 Day Avg. Volume70,779
Financial Highlights & Ratios
PEG Ratio7.45
Price to Book (P/B)N/A
Price to Sales (P/S)2.13
Price to Cash Flow (P/CF)27.20
P/FCF Ratio27.20
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$547.50Price Target Upside16.63% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Cavco Industries Business Overview & Revenue Model
Company DescriptionCavco Industries, Inc. designs, produces, and retails manufactured homes primarily in the United States. It operates in two segments, Factory-Built Housing and Financial Services. The company markets its manufactured homes under the Cavco, Fleetwood, Palm Harbor, Nationwide, Fairmont, Friendship, Chariot Eagle, Destiny, Commodore, Colony, Pennwest, R-Anell, Manorwood, and MidCountry brands. It also builds park model RVs; vacation cabins; and factory-built commercial structures, including apartment buildings, condominiums, hotels, workforce housing, schools, and housing for the United States military troops. In addition, the company produces various modular homes, which include single and multi-section ranch, split-level, and Cape Cod style homes, as well as two- and three-story homes, and multi-family units. Further, it provides conforming and non-conforming mortgages and home-only loans to purchasers of various brands of factory-built homes sold by company-owned retail stores, as well as various independent distributors, builders, communities, and developers. Additionally, the company offers property and casualty insurance to owners of manufactured homes. As of April 3, 2022, it operated 45 company-owned retail stores in Oregon, Arizona, Nevada, New Mexico, Texas, Indiana, Oklahoma, Florida, and New York. The company also distributes its homes through a network of independent distribution points in 48 states and Canada; and through planned community operators and residential developers. Cavco Industries, Inc. was founded in 1965 and is headquartered in Phoenix, Arizona.
How the Company Makes MoneyCavco Industries generates revenue primarily through the manufacturing and sale of factory-built homes. The company operates a network of retail centers and partners with independent retailers to distribute its products across the United States. Key revenue streams include the direct sales of manufactured and modular homes, as well as commercial structures. Additionally, Cavco earns money through its financial services segment, which offers insurance products and financial solutions related to home ownership. Strategic partnerships with retailers and financial institutions further bolster the company's revenue model, allowing it to reach a broader customer base and provide added value through integrated housing solutions.
Cavco Industries Financial Statement Overview
Summary
Cavco Industries demonstrates a strong financial standing with robust profitability and balance sheet metrics. The income statement highlights effective revenue and cost management, while the balance sheet showcases financial strength with low leverage. Despite a decline in free cash flow growth, the company maintains solid cash flow ratios, indicating a generally healthy financial trajectory with some areas for improvement in cash flow generation.Income Statement
Cavco Industries demonstrates strong performance in the income statement metrics. The TTM Gross Profit Margin stands at 23.24%, with a Net Profit Margin of 8.76%, indicating solid profitability. Revenue growth from the previous year shows a positive trend of 7.33%. The EBIT and EBITDA margins are 9.78% and 10.85%, respectively, suggesting effective cost management and operational efficiency.85
Very Positive
Balance Sheet
The company's balance sheet reflects a robust financial position. A low Debt-to-Equity Ratio of 0.03 indicates minimal leverage, while the Return on Equity is a healthy 15.95%. The Equity Ratio of 76.31% further emphasizes financial stability and a strong capital structure, minimizing financial risk.88
Very Positive
Cash Flow
Cavco Industries exhibits a stable cash flow position with a Free Cash Flow growth rate of -32.96% over the previous period, highlighting potential challenges in generating free cash flow. However, the Operating Cash Flow to Net Income ratio of 0.94 indicates effective conversion of income into cash, and the Free Cash Flow to Net Income ratio is 0.82, suggesting reasonable cash flow health.78
Positive
| Breakdown | |||||
| TTM | Mar 2024 | Jun 2023 | Jun 2022 | Jun 2021 | Mar 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 1.93B | 1.79B | 2.14B | 1.63B | 1.11B | 1.06B | Gross Profit |
| 447.59M | 426.90M | 554.93M | 408.75M | 238.98M | 230.52M | EBIT |
| 188.34M | 178.98M | 184.79M | 202.50M | 88.83M | 84.91M | EBITDA |
| 219.31M | 195.86M | 315.00M | 212.81M | 94.41M | 89.19M | Net Income Common Stockholders |
| 168.64M | 157.82M | 240.55M | 197.70M | 76.65M | 75.07M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 74.99M | 370.96M | 286.40M | 264.24M | 341.77M | 256.41M | Total Assets |
| 232.34M | 1.35B | 1.31B | 1.15B | 951.83M | 810.43M | Total Debt |
| 0.00 | 35.15M | 21.68M | 24.78M | 25.55M | 25.70M | Net Debt |
| -74.99M | -317.54M | -249.75M | -219.37M | -296.73M | -216.13M | Total Liabilities |
| 51.99M | 320.75M | 330.47M | 323.69M | 268.19M | 202.84M | Stockholders Equity |
| 145.78M | 1.03B | 976.29M | 830.46M | 683.64M | 607.59M |
| Cash Flow | Free Cash Flow | ||||
| 138.96M | 207.26M | 211.59M | 125.57M | 88.49M | 87.40M | Operating Cash Flow |
| 158.43M | 224.68M | 255.69M | 144.22M | 114.03M | 101.74M | Investing Cash Flow |
| -19.14M | -31.71M | -129.34M | -159.10M | -23.35M | -25.24M | Financing Cash Flow |
| -127.27M | -107.71M | -102.20M | -65.09M | -6.98M | -20.76M |
Cavco Industries Technical Analysis
Negative
469.45
Price Trends
513.12
Negative
495.25
Negative
453.00
Positive
Market Momentum
-12.11
Positive
40.48
Neutral
35.60
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CVCO, the sentiment is Negative. The current price of 469.45 is below the 20-day moving average (MA) of 498.61, below the 50-day MA of 513.12, and above the 200-day MA of 453.00, indicating a neutral trend. The MACD of -12.11 indicates Positive momentum. The RSI at 40.48 is Neutral, neither overbought nor oversold. The STOCH value of 35.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CVCO.
Cavco Industries Risk Analysis
Cavco Industries disclosed 37 risk factors in its most recent earnings report. Cavco Industries reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Cavco Industries Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $3.81B | 23.41 | 16.33% | ― | 4.09% | 3.14% | |
76 Outperform | $2.87B | 5.39 | 20.66% | ― | 11.84% | 21.14% | |
73 Outperform | $4.64B | 6.02 | 16.12% | 2.43% | 4.18% | 7.50% | |
72 Outperform | $2.71B | 6.07 | 14.43% | ― | 20.93% | 39.33% | |
71 Outperform | $4.73B | 28.81 | 11.18% | ― | 22.52% | -18.73% | |
68 Neutral | $3.66B | 6.22 | 15.58% | 1.96% | 5.54% | 11.12% | |
60 Neutral | $7.23B | 11.55 | 3.67% | 4.04% | 2.96% | -13.54% |
* Consumer Cyclical Sector Average
Performance Comparison
CVCO
Cavco Industries
469.45
118.00
33.58%
KBH
KB Home
50.15
-9.94
-16.54%
MHO
M/I Homes
104.14
-7.26
-6.52%
MTH
Meritage
62.84
-10.83
-14.70%
SKY
Champion Homes
80.51
6.07
8.15%
TPH
Tri Pointe
29.06
-5.45
-15.79%
Cavco Industries Earnings Call Summary
Earnings Call Date: Jan 30, 2025 | % Change Since: -1.55% | Next Earnings Date: May 22, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive overall sentiment with significant improvements in EPS, revenue, and segment performance. The company has successfully implemented strategies to enhance profitability and market positioning, despite facing some regional market challenges and external uncertainties.Highlights
Strong EPS Growth
Earnings per share (EPS) increased by 30% sequentially to $6.90, driven by improved results in both financial services and factory-built housing.
Financial Services Segment Recovery
The Financial Services segment recorded its best quarterly profit in four years, with improved profitability due to changes in underwriting and premium increases.
Revenue Increase
Net revenue for the third fiscal quarter of 2025 was $522 million, up $75.2 million or 16.8% compared to $446.8 million during the prior year.
Factory-Built Housing Segment Performance
Factory-built housing segment net revenue was $500.9 million, up 17.3%, with a 21.6% increase in homes sold, despite a 3.5% decrease in average revenue per home sold.
Digital Marketing Strategy Success
Increased traffic, lead generation, and the number of independent retail businesses connecting to the digital platform validated the company's digital marketing strategy.
Gross Margin Improvement
Consolidated gross margins improved by 180 basis points to 24.9% compared to the same period last year.
Lowlights
Decrease in Average Revenue per Home Sold
The average revenue per home sold decreased by 3.5%, primarily due to a lower proportion of homes sold through company-owned stores and product pricing decreases.
Challenges in Florida Market
The Florida market remains challenging with slower market improvements compared to other regions.
Potential Impact of New Administration Policies
Uncertainty regarding tariffs and potential immigration policies that may impact input costs and labor availability.
Company Guidance
During the third quarter of fiscal year 2025, Cavco Industries reported strong performance across its operations, with a 30% sequential increase in earnings per share (EPS) to $6.90. The Financial Services segment recorded its highest quarterly profit in four years, driven by improved insurance operations, including better underwriting practices and premium increases. Meanwhile, the Factory-built Housing segment saw a 3.4% increase in volume and a gross margin improvement of 70 basis points, despite normal seasonal slowdowns. Net revenue for the quarter was $522 million, representing a 16.8% increase from the previous year. The company also maintained a healthy backlog of six to eight weeks and increased production rates, positioning itself well for future demand. Additionally, Cavco repurchased $42 million in stock, with cumulative repurchases totaling $389 million since the program's initiation. The effective tax rate decreased to 18.6% due to tax credits for ENERGY STAR compliant home shipments, contributing to a net income of $56.5 million, up $20.5 million from the prior year.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.