Cavco Industries (NASDAQ:CVCO) Shares Gap Down on Disappointing Earnings

Shares of Cavco Industries, Inc. (NASDAQ:CVCO) gapped down before the market opened on Friday following a dissappointing earnings announcement. The stock had previously closed at $617.50, but opened at $548.60. Cavco Industries shares last traded at $522.70, with a volume of 64,144 shares changing hands.

The construction company reported $5.58 earnings per share (EPS) for the quarter, missing the consensus estimate of $6.00 by ($0.42). The firm had revenue of $580.99 million during the quarter, compared to the consensus estimate of $593.37 million. Cavco Industries had a return on equity of 17.91% and a net margin of 8.37%.

Key Stories Impacting Cavco Industries

Here are the key news stories impacting Cavco Industries this week:

• Positive Sentiment: Revenue growth and acquisition contribution — Net revenue rose 11.3% year-over‑year to $581.0M, driven by higher home sales and a $42M revenue contribution from the recent American Homestar acquisition. GlobeNewswire: Q3 Release
• Positive Sentiment: Financial services improvement and share buybacks — The financial‑services segment showed stronger gross margins (65.2% vs. 55.5% prior year) and management repurchased ≈$44M of stock in the quarter with ~$98M remaining authorization. Quiver: Q3 Summary
• Neutral Sentiment: Backlog and capacity — Backlog ended the quarter at ~$160M (4–6 weeks of production); capacity utilization fell to ~70% (from ~75% a year ago), leaving room to scale production into the spring if demand improves. GlobeNewswire: Q3 Release
• Neutral Sentiment: Conference call / outlook — Management reiterated optimism for the Spring selling season but warned industry shipments slowed in Oct–Nov; a conference call/webcast is scheduled for investor Q&A. GlobeNewswire: Q3 Release
• Negative Sentiment: Earnings and revenue missed consensus — Diluted EPS was $5.58 (down ~19% YoY) and revenue came in below street estimates, which prompted immediate negative price reaction from investors. Investing.com: Earnings Miss
• Negative Sentiment: Margin compression and lower operating profit — Consolidated gross margin narrowed (23.4% vs. 24.9% year‑ago) and income from operations declined ~14.7% as factory-built housing margins fell and SG&A increased (deal costs + integration spend). Quiver: Financial Details
• Negative Sentiment: Integration costs, higher SG&A and cash decline — The American Homestar acquisition added ~$6.9M of incremental SG&A plus ~$2.9M of deal costs; cash and cash equivalents fell to ~$224.6M, which may concern some investors given recent buybacks and increased capex. Quiver: Q3 Summary
• Negative Sentiment: Insider selling noted — Recent filings show multiple insider sales in the last six months, which can weigh on sentiment even if not determinative of fundamentals. Quiver: Insider Activity

Analyst Ratings Changes

CVCO has been the topic of a number of research analyst reports. CJS Securities upgraded Cavco Industries to a “strong-buy” rating in a research note on Thursday, December 11th. Zacks Research lowered Cavco Industries from a “strong-buy” rating to a “hold” rating in a report on Tuesday, December 16th. Finally, Weiss Ratings reissued a “buy (b)” rating on shares of Cavco Industries in a research report on Monday, December 29th. One research analyst has rated the stock with a Strong Buy rating, one has issued a Buy rating and two have given a Hold rating to the company’s stock. According to MarketBeat, Cavco Industries currently has a consensus rating of “Moderate Buy” and a consensus price target of $550.00.

Insider Buying and Selling

In other Cavco Industries news, Director Richard A. Kerley sold 500 shares of the stock in a transaction on Friday, November 7th. The stock was sold at an average price of $568.99, for a total transaction of $284,495.00. Following the completion of the transaction, the director directly owned 6,669 shares of the company’s stock, valued at approximately $3,794,594.31. This represents a 6.97% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Insiders own 1.60% of the company’s stock.

Institutional Inflows and Outflows

Institutional investors have recently made changes to their positions in the company. Salomon & Ludwin LLC purchased a new stake in Cavco Industries in the 3rd quarter worth about $31,000. Farther Finance Advisors LLC boosted its position in Cavco Industries by 151.4% during the second quarter. Farther Finance Advisors LLC now owns 88 shares of the construction company’s stock worth $38,000 after purchasing an additional 53 shares during the period. Danske Bank A S bought a new position in Cavco Industries during the third quarter worth about $58,000. Mather Group LLC. purchased a new position in shares of Cavco Industries in the third quarter worth about $63,000. Finally, CIBC Private Wealth Group LLC raised its position in shares of Cavco Industries by 72.5% in the third quarter. CIBC Private Wealth Group LLC now owns 119 shares of the construction company’s stock valued at $69,000 after purchasing an additional 50 shares during the period. Hedge funds and other institutional investors own 95.56% of the company’s stock.

Cavco Industries Stock Performance

The stock’s 50 day moving average is $616.41 and its 200 day moving average is $551.55. The company has a market capitalization of $3.84 billion, a PE ratio of 21.37 and a beta of 1.31.

Cavco Industries Company Profile

Cavco Industries, Inc is a leading designer, manufacturer and retailer of factory-built homes and modular structures. The company produces a range of HUD-code manufactured homes, modular buildings, park model RVs and cabins through its network of production facilities. Its offerings cater to both residential and commercial markets, including customizable single- and multi-section homes, workforce and affordable housing solutions, educational and healthcare modules, as well as specialty lodging products for the recreational vehicle and hospitality industries.

Since its founding in 1967, Cavco has grown through strategic investments and acquisitions, expanding its footprint across the United States and into parts of Canada and Mexico.