Cavco Industries, Inc. Just Beat EPS By 41%: Here's What Analysts Think Will Happen Next

Cavco Industries, Inc. (NASDAQ:CVCO) defied analyst predictions to release its quarterly results, which were ahead of market expectations. The company beat forecasts, with revenue of US$522m, some 8.7% above estimates, and statutory earnings per share (EPS) coming in at US$6.90, 41% ahead of expectations. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Cavco Industries

Taking into account the latest results, the most recent consensus for Cavco Industries from three analysts is for revenues of US$2.18b in 2026. If met, it would imply a solid 13% increase on its revenue over the past 12 months. Per-share earnings are expected to bounce 22% to US$25.72. Before this earnings report, the analysts had been forecasting revenues of US$2.09b and earnings per share (EPS) of US$23.41 in 2026. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.

With these upgrades, we're not surprised to see that the analysts have lifted their price target 12% to US$548per share. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Cavco Industries, with the most bullish analyst valuing it at US$550 and the most bearish at US$545 per share. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Cavco Industries is an easy business to forecast or the the analysts are all using similar assumptions.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Cavco Industries' revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 10% growth on an annualised basis. This is compared to a historical growth rate of 14% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.4% annually. Even after the forecast slowdown in growth, it seems obvious that Cavco Industries is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Cavco Industries following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Cavco Industries analysts - going out to 2027, and you can see them free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with Cavco Industries , and understanding this should be part of your investment process.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.