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Cavco Industries, Inc. (CVCO)
:CVCO
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Cavco Industries
(NASDAQ:CVCO)
Rating:77Outperform
Price Target:―
Cavco Industries (CVCO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.48B
Dividend YieldN/A
Average Volume (3M)182.29K
Price to Earnings (P/E)20.7
Beta (1Y)1.07
Revenue Growth4.09%
EPS Growth3.14%
CountryUS
Employees6,500
SectorConsumer Cyclical
Sector Strength56
IndustryResidential Construction
Share Statistics
EPS (TTM)5.40
Shares Outstanding8,088,794
10 Day Avg. Volume242,782
30 Day Avg. Volume182,290
Financial Highlights & Ratios
PEG Ratio-1.32
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio27.83
Enterprise Value/Market Cap1.00
Enterprise Value/Revenue0.49
Enterprise Value/Gross Profit9.92
Enterprise Value/Ebitda4.47
Forecast
1Y Price Target
$550.00Price Target Upside27.80% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Cavco Industries Business Overview & Revenue Model
Company DescriptionCavco Industries, Inc. (CVCO) is a leading designer and producer of factory-built homes, serving a wide range of housing needs in the United States. The company operates through several brands, including Cavco Homes, Fleetwood Homes, and Palm Harbor Homes, offering manufactured and modular homes that cater to various residential markets. Cavco also provides insurance and financial services to its customers, enhancing its comprehensive approach to housing solutions.
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 Earnings Call Summary
Earnings Call Date:May 22, 2025
(Q4-2025)
| % Change Since: -13.80%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mix of strong financial performance and strategic initiatives such as increased shipments, revenue growth, and a successful share buyback program. However, these were offset by challenges like production disruptions due to weather, a decline in gross margin and financial services revenue, and increased SG&A expenses. Market challenges, particularly in Florida, also posed concerns.Q4-2025 Updates
Positive Updates
Significant Increase in Unit Shipments
Unit shipments were up almost 29% year-over-year, indicating strong demand and production capacity improvements.
Strong Financial Performance
Net revenue for the fourth fiscal quarter of 2025 was $508.4 million, up $88.2 million or 21% from the prior year, driven by a 28.5% increase in homes sold.
Successful Share Buyback Program
Cavco repurchased about $33 million of stock this quarter, and since fiscal 2021, they have bought back 15.5% of outstanding shares.
Improved Branding Strategy
Rebranding of manufacturing plants to unify under the Cavco name, enhancing digital marketing efforts and customer experience.
Effective Tax Rate Reduction
The effective income tax rate was reduced to 15.4% from 21% in the prior year, partly due to higher Energy Star tax credits.
Negative Updates
Impact of Harsh Weather
Lost 24 operating days across the system due to unexpected harsh weather in February, affecting production and installations.
Decrease in Financial Services Revenue
Financial services segment net revenue was down $1.1 million or 5.2% from the prior year due to fewer loan sales and insurance policies.
Gross Margin Decline
Consolidated gross margin as a percentage of net revenue was down 80 basis points to 22.8% from 23.6% in the prior year.
Increased SG&A Expenses
Selling, general, and administrative expenses increased to $77.5 million from $61.4 million, partly due to a $10 million write-off of intangible trade name values.
Challenges in Florida Market
Continued difficulties in the Florida market with significant price competition and reduced demand.
Company Guidance
During the Cavco Industries Fourth Quarter 2025 Earnings Call, management provided guidance on several key metrics. Net revenue for the fourth fiscal quarter was $508.4 million, representing a 21% increase from the previous year, despite a sequential decrease of $13.7 million due to a decline in average revenue per home sold. Factory-built housing net revenue was $487.9 million, up 22.4% year-over-year, driven by a 28.5% increase in homes sold. Factory utilization improved significantly, reaching 70% to 75% compared to 60% in the prior year. The financial services segment faced a revenue decline of 5.2% to $20.5 million, attributed to fewer loan sales and insurance policies. Gross margin fell by 80 basis points to 22.8%, while selling, general, and administrative expenses rose due to a $10 million write-off related to brand realignment. Despite these challenges, net income increased to $36.3 million, and adjusted net income was $43.9 million, translating to an adjusted diluted EPS of $5.40. The company also repurchased $33.2 million of stock in the quarter, maintaining strong cash generation with $375.3 million in cash and restricted cash. Cavco is prepared for potential impacts from tariffs and remains confident in its strategic investments and market positioning.Cavco Industries Financial Statement Overview
Summary
Cavco Industries exhibits strong financial performance with robust profitability and a solid balance sheet. The income statement shows effective revenue and cost management with a net profit margin of 8.76% and revenue growth of 7.33%. The balance sheet is strong with a low debt-to-equity ratio of 0.03 and a high equity ratio of 76.31%, indicating minimal leverage and financial stability. However, the cash flow score is slightly lower due to a -32.96% decline in free cash flow growth, despite reasonable cash flow health ratios.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 | Mar 2025 | Mar 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.02B | 1.79B | 2.14B | 1.63B | 1.11B |
| Gross Profit | 465.59M | 426.90M | 554.93M | 408.75M | 238.98M |
| EBITDA | 190.28M | 219.35M | 315.00M | 212.81M | 94.41M |
| Net Income | 171.04M | 157.82M | 240.55M | 197.70M | 76.65M |
Balance Sheet | |||||
| Total Assets | 0.00 | 1.35B | 1.31B | 1.15B | 951.83M |
| Cash, Cash Equivalents and Short-Term Investments | 0.00 | 370.96M | 286.40M | 264.24M | 341.77M |
| Total Debt | 0.00 | 35.15M | 21.68M | 24.78M | 25.55M |
| Total Liabilities | 0.00 | 320.75M | 330.47M | 323.69M | 268.19M |
| Stockholders Equity | 0.00 | 1.03B | 976.29M | 830.46M | 683.64M |
Cash Flow | |||||
| Free Cash Flow | 157.07M | 207.26M | 211.59M | 125.57M | 88.49M |
| Operating Cash Flow | 178.50M | 224.68M | 255.69M | 144.22M | 114.03M |
| Investing Cash Flow | -23.95M | -31.71M | -129.34M | -159.10M | -23.35M |
| Financing Cash Flow | -147.95M | -107.71M | -102.20M | -65.09M | -6.98M |
Cavco Industries Technical Analysis
Neutral
430.35
Price Trends
465.83
Negative
489.94
Negative
472.73
Negative
Market Momentum
-13.90
Negative
48.03
Neutral
80.42
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CVCO, the sentiment is Neutral. The current price of 430.35 is above the 20-day moving average (MA) of 418.65, below the 50-day MA of 465.83, and below the 200-day MA of 472.73, indicating a neutral trend. The MACD of -13.90 indicates Negative momentum. The RSI at 48.03 is Neutral, neither overbought nor oversold. The STOCH value of 80.42 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CVCO.
Cavco Industries Risk Analysis
Cavco Industries disclosed 36 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 (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $2.90B | 7.12 | 13.28% | ― | 10.82% | 19.34% | |
77 Outperform | $2.94B | 5.88 | 19.02% | ― | 8.68% | 8.39% | |
77 Outperform | $3.48B | 20.73 | 16.30% | ― | 4.09% | 3.14% | |
73 Outperform | $3.57B | 18.25 | 13.38% | ― | 22.65% | 34.77% | |
73 Outperform | $4.72B | 6.66 | 14.58% | 2.60% | -0.68% | -7.99% | |
68 Neutral | $3.71B | 6.85 | 14.09% | 1.93% | 3.65% | -0.48% | |
62 Neutral | $16.72B | 10.85 | -7.48% | 3.15% | 1.66% | -24.52% |
* Consumer Cyclical Sector Average
Performance Comparison
CVCO
Cavco Industries
430.35
84.18
24.32%
KBH
KB Home
52.72
-16.43
-23.76%
MHO
M/I Homes
112.74
-9.40
-7.70%
MTH
Meritage
66.76
-12.48
-15.75%
SKY
Champion Homes
62.58
-5.17
-7.63%
TPH
Tri Pointe
31.96
-5.29
-14.20%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.