Legacy Housing (LEGH) AI Stock Analysis

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Legacy Housing

(NASDAQ:LEGH)

Rating:71Outperform

Price Target:

$27.00

▲(7.66% Upside)

Legacy Housing's strong financial performance and attractive valuation are key strengths, supported by robust sales growth and improved margins. However, technical indicators suggest caution due to potential overbought conditions, and earnings call insights reveal mixed sentiment with both growth opportunities and challenges.

Legacy Housing (LEGH) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$598.63M

Dividend YieldN/A

Average Volume (3M)61.24K

Price to Earnings (P/E)11.1

Beta (1Y)0.81

Revenue Growth8.79%

EPS Growth2.30%

CountryUS

Employees594

SectorConsumer Cyclical

Sector Strength72

IndustryResidential Construction

Share Statistics

EPS (TTM)0.61

Shares Outstanding23,868,727

10 Day Avg. Volume55,704

30 Day Avg. Volume61,244

Financial Highlights & Ratios

PEG Ratio0.68

Price to Book (P/B)1.21

Price to Sales (P/S)3.24

P/FCF Ratio22.32

Enterprise Value/Market Cap0.93

Enterprise Value/Revenue3.15

Enterprise Value/Gross Profit6.69

Enterprise Value/Ebitda8.36

Forecast

1Y Price Target

$28.25

Price Target Upside12.64% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering4

Legacy Housing Business Overview & Revenue Model

Company DescriptionLegacy Housing Corporation builds, sells, and finances manufactured homes and tiny houses primarily in the southern United States. The company manufactures and provides for the transport of mobile homes; and offers wholesale financing to dealers and mobile home parks, as well as a range of homes, including 1 to 5 bedrooms with 1 to 3 1/2 bathrooms. It also provides floor plan financing for independent retailers; consumer financing for its products; and financing to manufactured housing community owners that buy its products for use in their rental housing communities. In addition, it involved in financing and developing new manufactured home communities; and retail financing to consumers. The company markets its homes under the Legacy brand through a network of 176 independent and 13 company-owned retail locations, as well as direct sales to owners of manufactured home communities in 15 states in the United States. Legacy Housing Corporation was founded in 2005 and is headquartered in Bedford, Texas.

How the Company Makes MoneyLegacy Housing generates revenue primarily through the sale of manufactured and modular homes. The company has several key revenue streams, including direct sales to consumers and sales through independent retailers. Additionally, Legacy Housing benefits from financing programs that allow customers to purchase homes through loans, which can also yield interest income. The company has established partnerships with various financial institutions to facilitate these financing options. Furthermore, it generates ancillary revenue from service and warranty contracts, as well as from selling parts and accessories related to home maintenance. These diverse revenue streams contribute to the company's overall financial performance.

Legacy Housing Earnings Call Summary

Earnings Call Date:Aug 07, 2025

(Q2-2025)

% Change Since: 6.32%|

Next Earnings Date:Nov 05, 2025

Earnings Call Sentiment Neutral

While there were significant improvements in product sales and gross margin, challenges such as a decrease in net income, increased expenses, and slower community sales contributed to a more balanced overall outlook.

Q2-2025 Updates

Positive Updates

Strong Product Sales Growth

Product sales increased $6.7 million or 21.3% during Q2 2025 compared to Q2 2024, driven by unit volume increases in inventory finance, retail, and mobile home park sales.

Improved Gross Profit Margin

Gross profit margin improved to 32.4% in Q2 2025 from 31.9% in Q2 2024, indicating better cost management and pricing strategy.

Increase in Cash Reserves

Cash increased to $2.6 million as of June 30, 2025, from $1.1 million on December 31, 2024, showing improved liquidity.

Significant Share Repurchase

Repurchased 260,635 shares of common stock for $5.8 million during Q2 2025, reflecting confidence in long-term business value.

Negative Updates

Decrease in Net Income and EPS

Net income decreased 9.2% to $14.7 million and basic earnings per share decreased 9.0% to $0.61 in Q2 2025 compared to Q2 2024.

Decline in Other Income

Other income decreased $2.8 million or 74.5% during Q2 2025, primarily due to lower nonoperating interest income and a decrease in miscellaneous income from land sales.

Increased Selling, General and Administrative Expenses

SG&A expenses increased $1.1 million or 19.1% during Q2 2025 compared to Q2 2024, due to various factors including higher warranty and repossessed home expenses.

Challenges in Community Sales

Community sales face headwinds due to elevated interest rates, higher operating costs, and budget constraints among renters.

Company Guidance

During the Legacy House Corporation's second quarter 2025 earnings call, the company reported a significant increase in product sales, which rose by $6.7 million or 21.3% compared to the same period in 2024, driven by higher unit volumes in inventory finance, retail sales, and mobile home park sales. The net revenue per product sold also increased by 10.5%, primarily due to higher retail prices. The consumer loan portfolio grew by $24.6 million, while the MHP loan portfolio increased by $20.3 million. Despite a 9.2% decrease in net income to $14.7 million, the company's gross profit margin improved slightly to 32.4%. Legacy House also repurchased 260,635 shares for $5.8 million and maintained a strong cash position of $2.6 million as of June 30, 2025. The company emphasized its focus on expanding its backlog, particularly in Texas, and expressed optimism about legislative changes that could support growth in home sales and community development.

Legacy Housing Financial Statement Overview

Summary

Legacy Housing shows strong profitability and a robust balance sheet with a low debt-to-equity ratio, indicating financial stability. However, cash flow volatility poses some risks, though mitigated by stable margins and low leverage.

Income Statement

Positive

Legacy Housing has demonstrated solid profitability with consistent gross and net profit margins. However, revenue growth has been inconsistent, with recent periods showing declines. EBIT and EBITDA margins remain healthy, indicating efficient operations.

Balance Sheet

Positive

The company maintains a strong equity base with a low debt-to-equity ratio, highlighting financial stability. The equity ratio is high, suggesting a strong capital structure. Return on equity is respectable, indicating effective use of equity.

Cash Flow

Positive

Operating cash flow has fluctuated, impacting free cash flow growth. The operating cash flow to net income ratio is positive, indicating good cash conversion from earnings. However, free cash flow volatility presents a potential risk.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	176.62M	184.19M	189.14M	257.01M	197.51M	176.72M
Gross Profit	83.14M	94.12M	89.45M	106.90M	83.46M	67.00M
EBITDA	66.55M	78.63M	71.39M	84.30M	63.10M	51.09M
Net Income	56.78M	61.64M	54.46M	67.77M	49.87M	37.99M
Balance Sheet
Total Assets	544.61M	534.19M	506.74M	436.81M	366.67M	338.62M
Cash, Cash Equivalents and Short-Term Investments	3.41M	1.15M	748.00K	11.23M	1.04M	768.00K
Total Debt	1.28M	1.40M	25.57M	5.32M	7.99M	36.17M
Total Liabilities	40.88M	40.24M	70.01M	54.71M	57.27M	79.42M
Stockholders Equity	503.73M	493.96M	436.74M	382.10M	309.39M	259.19M
Cash Flow
Free Cash Flow	20.49M	26.78M	-21.25M	-5.49M	54.34M	-4.88M
Operating Cash Flow	30.09M	35.99M	-13.54M	-1.69M	60.30M	-2.04M
Investing Cash Flow	-11.40M	-6.71M	-9.77M	9.08M	-31.94M	-2.72M
Financing Cash Flow	-15.90M	-28.88M	21.23M	-5.61M	-28.08M	3.60M

Legacy Housing Technical Analysis

Technical Analysis Sentiment

Positive

Last Price25.08

Price Trends

50DMA

22.77

Positive

100DMA

23.54

Positive

200DMA

24.51

Positive

Market Momentum

MACD

0.36

Negative

RSI

71.69

Negative

STOCH

75.14

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LEGH, the sentiment is Positive. The current price of 25.08 is above the 20-day moving average (MA) of 22.97, above the 50-day MA of 22.77, and above the 200-day MA of 24.51, indicating a bullish trend. The MACD of 0.36 indicates Negative momentum. The RSI at 71.69 is Negative, neither overbought nor oversold. The STOCH value of 75.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LEGH.

Legacy Housing Peers Comparison

Overall Rating

UnderperformOutperform

Sector (56)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HOV	79 Outperform	$738.05M	4.71	28.55%	―	7.93%	-3.59%
UHG	74 Outperform	$236.17M	65.42	9.58%	―	7.51%	-97.77%
CCS	73 Outperform	$1.81B	7.43	10.34%	1.83%	3.76%	-17.55%
LEGH	71 Outperform	$598.63M	11.15	11.33%	―	8.79%	2.30%
LGIH	68 Neutral	$1.31B	8.59	7.84%	―	-7.89%	-19.53%
BZH	59 Neutral	$686.66M	10.48	5.65%	―	9.97%	-52.57%
Sector *	56 Neutral	HK$25.37B	4.80	-2.69%	5.71%	-0.46%	-53.29%

* Consumer Cyclical Sector Average

Performance Comparison

LEGH

Legacy Housing

25.08

-0.71

-2.75%

BZH

Beazer Homes

23.10

-4.74

-17.03%

HOV

Hovnanian Enterprises

134.37

-50.90

-27.47%

LGIH

LGI Homes

56.93

-45.71

-44.53%

CCS

Century Communities

60.02

-30.59

-33.76%

UHG

United Homes Group

4.03

-1.72

-29.91%

Legacy Housing Corporate Events

Executive/Board Changes

Legacy Housing Appoints Skyler Howton to Board

Neutral

Nov 18, 2024

Skyler M. Howton has been appointed to the Company’s Board of Directors, filling a vacancy left by Francisco J. Coll. With a robust legal background and leadership roles in Dallas, she will serve on key committees and stand for election at the 2024 Annual Shareholders’ Meeting. Howton’s appointment aligns with SEC and NASDAQ independence standards, and she will receive compensation similar to other non-employee directors.

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.Date of analysis: Aug 12, 2025