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CVCO

Cavco Industries NasdaqGS:CVCO Stock Report

Last Price

US$196.92

Market Cap

US$1.8b

7D

4.4%

1Y

-11.4%

Updated

29 Jun, 2022

Data

Company Financials +
CVCO fundamental analysis
Snowflake Score
Valuation3/6
Future Growth2/6
Past Performance6/6
Financial Health6/6
Dividends0/6

CVCO Stock Overview

Cavco Industries, Inc. designs, produces, and retails manufactured homes primarily in the United States.

Cavco Industries Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Cavco Industries
Historical stock prices
Current Share PriceUS$196.92
52 Week HighUS$327.24
52 Week LowUS$179.47
Beta0.98
1 Month Change-10.16%
3 Month Change-18.24%
1 Year Change-11.37%
3 Year Change24.73%
5 Year Change51.42%
Change since IPO2,525.60%

Recent News & Updates

Jun 30

Cavco Industries: Finally Worth Considering

Cavco Industries has been hit hard by the market downturn recently, with shares tanking due to concerns over the outlook for the housing market. The company does not look cheap using 2021 results, but if recent performance is any indication then it could finally be worth considering. Investors who acknowledge the existence of a housing shortage should definitely put the company on their list of attractive prospects even though near-term pain could exist. One of the beautiful things about investing is that the market can be irrational from time to time. Although this can be painful when you're on the receiving end of significant downside in a stock, it can also open the door for opportunities to buy companies on the cheap before they eventually rise back up. One company that seems to have fallen too far in recent months is Cavco Industries (CVCO). This designer and producer of factory-built homes has been slammed as a result of concerns over a potential recession and the impact that rising interest rates might have on housing. In the near term, it's not unthinkable that the company could experience a bit more pain. But for long-term investors, now might be a good time to consider a stake in the enterprise. A niche homebuilder As I wrote in a prior article, Cavco Industries focuses on designing and producing factory-built homes that are then largely distributed through the company's network of independent and company-owned retailers, planned community operators, and residential developers. Although factory-built homes are often given a jaundiced glance because of lower quality, they do offer an opportunity for lower-income individuals, especially at a time when there is a national housing shortage. This, combined with the company's historical track record, was why I rated the firm a ‘hold’ when I last wrote about it in March of this year, despite the fact that, using 2021 results, shares were looking quite lofty. Since then, the market has declined in value by 9.6% while shares of Cavco Industries have generated a loss for investors of 27%. To be fair, I did state in my prior article that the company could experience some pain in the event of a decline in profitability. Author - SEC EDGAR Data Interestingly, however, we have seen no such decline. In fact, the business continues to generate strong financial performance. When I last wrote about the company, we had data covering through the third quarter of the firm's 2022 fiscal year. Fast forward to today, and we now know what the rest of the year looked like. In the final quarter of the year, the company generated revenue of $505.5 million. That dwarfs the $306.5 million the company generated the same quarter just one year earlier. This increase in revenue was driven by a couple of different factors. First and foremost, the average revenue per home sold grew from $75,100 to $98,134. Author - SEC EDGAR Data Pricing increased in large part because of supply chain issues and inflationary pressures, with management ultimately pushing the higher costs onto customers. Of course, this is only possible in an environment where the company is experiencing strong demand. And sure enough, demand was impressive in the final quarter, with a number of factory-built homes during that time totaling 4,976. That represents an increase of 29.8% over the 3,835 homes the business produced just one year earlier. Despite the number of homes increasing, the company also saw a surge in backlog, with the metric rising from $603 million at the end of the 2021 fiscal year to $1.1 billion today. Absent homes being canceled, this does look to pave the way for additional homebuilding moving forward. Thanks to the strong performance in the final quarter, combined with overall strength for the entirety of the 2022 fiscal year, overall revenue for the fiscal year came in at $1.63 billion. That's 46.8% above the $1.11 billion generated in the 2021 fiscal year. Overall revenue per home during this timeframe increased from $73,019 to $93,002. Meanwhile, the number of factory-built homes increased modestly, climbing from 14,214 to 16,697. Historically speaking, I wouldn't exactly call the homebuilding industry a high-margin space. This has natural downsides but there is one upside for investors to consider. Any low-margin company can see its profitability skyrocket with just a small improvement in pricing and/or volume. To see what I mean, we need only look at recent financial performance for the business. Net income in the final quarter of the 2022 fiscal year came in at $53.6 million. That's more than double the $25.2 million generated just one year earlier. As a result of this, total profitability for the 2022 fiscal year came in at $197.7 million. That's almost triple the $76.6 million generated in the 2021 fiscal year. Other profitability metrics have followed suit. Although operating cash flow did decline in the latest quarter, falling from $22.4 million at the end of 2021 to $18.2 million the same time of the 2022 fiscal year, this figure, on an adjusted basis, increased from $21.3 million to $85.7 million. Meanwhile, EBITDA for the company also improved, shooting up from $44.4 million to $75.8 million. Due to this, operating cash flow, adjusted operating cash flow, and EBITDA all shot up in the 2022 fiscal year relative to the 2021 fiscal year. Author - SEC EDGAR Data This has had a significant impact on the company's valuation. For instance, using 2022 results, the firm is trading at a price-to-earnings multiple of 9. While this is cheap, the multiple does look expensive if we use the 2021 fiscal year data instead, placing a multiple on the company of 23.1. The price to adjusted operating cash flow multiple should be 9.2. That's down from the 28.9 reading that we get using the 2021 results. Meanwhile, the EV to EBITDA multiple is 6.9. That compares to the 15.1 that we get if we rely on the 2021 results. The company benefits, in this respect, from cash in excess of debt of $267.8 million. That drastically reduces the risk for the enterprise in the event of a downturn.

Jun 20
Do Cavco Industries' (NASDAQ:CVCO) Earnings Warrant Your Attention?

Do Cavco Industries' (NASDAQ:CVCO) Earnings Warrant Your Attention?

The excitement of investing in a company that can reverse its fortunes is a big draw for some speculators, so even...

Jun 06
Why We Like The Returns At Cavco Industries (NASDAQ:CVCO)

Why We Like The Returns At Cavco Industries (NASDAQ:CVCO)

If we want to find a potential multi-bagger, often there are underlying trends that can provide clues. Amongst other...

Shareholder Returns

CVCOUS Consumer DurablesUS Market
7D4.4%3.5%1.6%
1Y-11.4%-33.7%-20.8%

Return vs Industry: CVCO exceeded the US Consumer Durables industry which returned -33.2% over the past year.

Return vs Market: CVCO exceeded the US Market which returned -20.4% over the past year.

Price Volatility

Is CVCO's price volatile compared to industry and market?
CVCO volatility
CVCO Average Weekly Movement7.7%
Consumer Durables Industry Average Movement8.4%
Market Average Movement8.1%
10% most volatile stocks in US Market16.8%
10% least volatile stocks in US Market3.2%

Stable Share Price: CVCO is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 8% a week.

Volatility Over Time: CVCO's weekly volatility (8%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
19656,300Bill Boorhttps://www.cavco.com

Cavco 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.

Cavco Industries Fundamentals Summary

How do Cavco Industries's earnings and revenue compare to its market cap?
CVCO fundamental statistics
Market CapUS$1.75b
Earnings (TTM)US$197.70m
Revenue (TTM)US$1.63b

8.9x

P/E Ratio

1.1x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
CVCO income statement (TTM)
RevenueUS$1.63b
Cost of RevenueUS$1.22b
Gross ProfitUS$388.07m
Other ExpensesUS$190.37m
EarningsUS$197.70m

Last Reported Earnings

Apr 02, 2022

Next Earnings Date

n/a

Earnings per share (EPS)22.23
Gross Margin23.85%
Net Profit Margin12.15%
Debt/Equity Ratio0.6%

How did CVCO perform over the long term?

See historical performance and comparison
We’ve recently updated our valuation analysis.

Valuation

Is CVCO undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for CVCO?

Other financial metrics that can be useful for relative valuation.

CVCO key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue0.9x
Enterprise Value/EBITDA7.1x
PEG Ratio2.4x

Price to Earnings Ratio vs Peers

How does CVCO's PE Ratio compare to its peers?

CVCO PE Ratio vs Peers
The above table shows the PE ratio for CVCO vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average6.8x
TPH Tri Pointe Homes
3.6x0.2%US$1.7b
IBP Installed Building Products
17.4x14.1%US$2.4b
CCS Century Communities
2.7x0.2%US$1.5b
MDC M.D.C. Holdings
3.7x3.8%US$2.2b
CVCO Cavco Industries
8.9x3.8%US$1.8b

Price-To-Earnings vs Peers: CVCO is expensive based on its Price-To-Earnings Ratio (8.9x) compared to the peer average (6.8x).


Price to Earnings Ratio vs Industry

How does CVCO's PE Ratio compare vs other companies in the US Consumer Durables Industry?

Price-To-Earnings vs Industry: CVCO is expensive based on its Price-To-Earnings Ratio (8.9x) compared to the US Consumer Durables industry average (7x)


Price to Earnings Ratio vs Fair Ratio

What is CVCO's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

CVCO PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio8.9x
Fair PE Ratio10.3x

Price-To-Earnings vs Fair Ratio: CVCO is good value based on its Price-To-Earnings Ratio (8.9x) compared to the estimated Fair Price-To-Earnings Ratio (10.3x).


Share Price vs Fair Value

What is the Fair Price of CVCO when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: CVCO ($196.92) is trading below our estimate of fair value ($404.23)

Significantly Below Fair Value: CVCO is trading below fair value by more than 20%.


Price to Earnings Growth Ratio

PEG Ratio: CVCO is poor value based on its PEG Ratio (2.4x)


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Future Growth

How is Cavco Industries forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

Future Growth Score

2/6

Future Growth Score 2/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


3.8%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CVCO's forecast earnings growth (3.8% per year) is above the savings rate (1.9%).

Earnings vs Market: CVCO's earnings (3.8% per year) are forecast to grow slower than the US market (13.7% per year).

High Growth Earnings: CVCO's earnings are forecast to grow, but not significantly.

Revenue vs Market: CVCO's revenue (10.8% per year) is forecast to grow faster than the US market (8.3% per year).

High Growth Revenue: CVCO's revenue (10.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if CVCO's Return on Equity is forecast to be high in 3 years time


Discover growth companies

Past Performance

How has Cavco Industries performed over the past 5 years?

Past Performance Score

6/6

Past Performance Score 6/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


23.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: CVCO has high quality earnings.

Growing Profit Margin: CVCO's current net profit margins (12.1%) are higher than last year (6.9%).


Past Earnings Growth Analysis

Earnings Trend: CVCO's earnings have grown significantly by 23.3% per year over the past 5 years.

Accelerating Growth: CVCO's earnings growth over the past year (158.4%) exceeds its 5-year average (23.3% per year).

Earnings vs Industry: CVCO earnings growth over the past year (158.4%) exceeded the Consumer Durables industry 39.2%.


Return on Equity

High ROE: CVCO's Return on Equity (23.8%) is considered high.


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Financial Health

How is Cavco Industries's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: CVCO's short term assets ($744.1M) exceed its short term liabilities ($294.2M).

Long Term Liabilities: CVCO's short term assets ($744.1M) exceed its long term liabilities ($29.5M).


Debt to Equity History and Analysis

Debt Level: CVCO has more cash than its total debt.

Reducing Debt: CVCO's debt to equity ratio has reduced from 14.3% to 0.6% over the past 5 years.

Debt Coverage: CVCO's debt is well covered by operating cash flow (2719.2%).

Interest Coverage: CVCO earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet


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Dividend

What is Cavco Industries's current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Future Dividend Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate CVCO's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate CVCO's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if CVCO's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if CVCO's dividend payments have been increasing.


Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as CVCO has not reported any payouts.


Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

1.8yrs

Average management tenure


CEO

Bill Boor (55 yo)

3.17yrs

Tenure

US$4,717,716

Compensation

Mr. William C. Boor, also known as Bill, has been the Chief Executive Officer of Great Lakes Brewing Company since September 2015. From December 2014 to September 2015, Mr. Boor was Principal of MIB Holdin...


CEO Compensation Analysis

Compensation vs Market: Bill's total compensation ($USD4.72M) is about average for companies of similar size in the US market ($USD5.49M).

Compensation vs Earnings: Bill's compensation has increased by more than 20% in the past year.


Leadership Team

Experienced Management: CVCO's management team is not considered experienced ( 1.8 years average tenure), which suggests a new team.


Board Members

Experienced Board: CVCO's board of directors are considered experienced (3.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Cavco Industries, Inc.'s employee growth, exchange listings and data sources


Key Information

  • Name: Cavco Industries, Inc.
  • Ticker: CVCO
  • Exchange: NasdaqGS
  • Founded: 1965
  • Industry: Homebuilding
  • Sector: Consumer Durables
  • Implied Market Cap: US$1.751b
  • Shares outstanding: 8.89m
  • Website: https://www.cavco.com

Number of Employees


Location

  • Cavco Industries, Inc.
  • 3636 North Central Avenue
  • Suite 1200
  • Phoenix
  • Arizona
  • 85012
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/06/29 00:00
End of Day Share Price2022/06/29 00:00
Earnings2022/04/02
Annual Earnings2022/04/02


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.