| Snowflake Score | |
|---|---|
| Valuation | 3/6 |
| Future Growth | 2/6 |
| Past Performance | 6/6 |
| Financial Health | 6/6 |
| Dividends | 0/6 |
CVCO Stock Overview
Cavco Industries, Inc. designs, produces, and retails manufactured homes primarily in the United States.
Rewards
Risk Analysis
No risks detected for CVCO from our risk checks.
Cavco Industries Competitors
Price History & Performance
| Historical stock prices | |
|---|---|
| Current Share Price | US$196.92 |
| 52 Week High | US$327.24 |
| 52 Week Low | US$179.47 |
| Beta | 0.98 |
| 1 Month Change | -10.16% |
| 3 Month Change | -18.24% |
| 1 Year Change | -11.37% |
| 3 Year Change | 24.73% |
| 5 Year Change | 51.42% |
| Change since IPO | 2,525.60% |
Recent News & Updates
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.
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...
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
| CVCO | US Consumer Durables | US Market | |
|---|---|---|---|
| 7D | 4.4% | 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
| CVCO volatility | |
|---|---|
| CVCO Average Weekly Movement | 7.7% |
| Consumer Durables Industry Average Movement | 8.4% |
| Market Average Movement | 8.1% |
| 10% most volatile stocks in US Market | 16.8% |
| 10% least volatile stocks in US Market | 3.2% |
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
| Founded | Employees | CEO | Website |
|---|---|---|---|
| 1965 | 6,300 | Bill Boor | https://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
| CVCO fundamental statistics | |
|---|---|
| Market Cap | US$1.75b |
| Earnings (TTM) | US$197.70m |
| Revenue (TTM) | US$1.63b |
8.9x
P/E Ratio1.1x
P/S RatioIs CVCO overvalued?
See Fair Value and valuation analysisEarnings & Revenue
| CVCO income statement (TTM) | |
|---|---|
| Revenue | US$1.63b |
| Cost of Revenue | US$1.22b |
| Gross Profit | US$388.07m |
| Other Expenses | US$190.37m |
| Earnings | US$197.70m |
Last Reported Earnings
Apr 02, 2022
Next Earnings Date
n/a
| Earnings per share (EPS) | 22.23 |
| Gross Margin | 23.85% |
| Net Profit Margin | 12.15% |
| Debt/Equity Ratio | 0.6% |
How did CVCO perform over the long term?
See historical performance and comparisonValuation
Is CVCO undervalued compared to its fair value, analyst forecasts and its price relative to the market?
Valuation Score
3/6Valuation 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.
| What is CVCO's n/a Ratio? | |
|---|---|
| n/a Ratio | 0x |
| n/a | n/a |
| Market Cap | US$1.75b |
| Key Statistics | |
|---|---|
| Enterprise Value/Revenue | 0.9x |
| Enterprise Value/EBITDA | 7.1x |
| PEG Ratio | 2.4x |
Price to Earnings Ratio vs Peers
How does CVCO's PE Ratio compare to its peers?
| CVCO PE Ratio vs Peers |
|---|
| Company | PE | Estimated Growth | Market Cap |
|---|---|---|---|
| Peer Average | 6.8x | ||
TPH Tri Pointe Homes | 3.6x | 0.2% | US$1.7b |
IBP Installed Building Products | 17.4x | 14.1% | US$2.4b |
CCS Century Communities | 2.7x | 0.2% | US$1.5b |
MDC M.D.C. Holdings | 3.7x | 3.8% | US$2.2b |
CVCO Cavco Industries | 8.9x | 3.8% | 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.
| Fair Ratio | |
|---|---|
| Current PE Ratio | 8.9x |
| Fair PE Ratio | 10.3x |
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)
Discover undervalued companies
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
2/6Future 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
6/6Past 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.
Discover strong past performing companies
Financial Health
How is Cavco Industries's financial position?
Financial Health Score
6/6Financial 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
Discover healthy companies
Dividend
What is Cavco Industries's current dividend yield, its reliability and sustainability?
Dividend Score
0/6Dividend 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
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2022/06/29 00:00 |
| End of Day Share Price | 2022/06/29 00:00 |
| Earnings | 2022/04/02 |
| Annual Earnings | 2022/04/02 |
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.