Cavco Industries Reports Strong Q1 Revenue Growth and Acquisition Plans

Cavco Industries reported Q1 2026 revenue up 16.6% YoY and 9.5% sequentially, with operating profit up 50% compared to both Q4 and Q1 2025. CEO William C. Boor highlighted a strong quarter, citing continued production ramp and the American Homestar acquisition as key factors.

Cavco Industries (CVCO) reported robust financial results for the first quarter of fiscal year 2026, significantly exceeding analyst expectations. The company posted earnings per share (EPS) of $6.42, well above the forecast of $5.55, marking a 15.68% surprise. Revenue reached $556.9 million, surpassing the anticipated $524.97 million. Following the earnings announcement, Cavco’s stock rose 3.13%, closing at $403.67 [1].

Key Takeaways

Cavco’s Q1 EPS exceeded expectations by 15.68%, while revenue increased by 16.6% year-over-year, driven by strong performance in the Factory Built Housing segment. The stock price rose 3.13% in post-earnings trading. The company announced the acquisition of American HomeStar for $184 million. Cavco continues to focus on geographic optimization and expanding consumer lending programs [1].

Company Performance

Cavco Industries demonstrated strong performance in Q1 FY2026, with a notable increase in net revenue and earnings per share compared to the previous year. The company benefited from increased production rates, a strategic acquisition, and a focused marketing approach. The Factory Built Housing segment, in particular, showed significant growth, reflecting the industry’s trend toward manufactured housing due to affordability concerns [1].

Financial Highlights

Revenue: $556.9 million, up 16.6% year-over-year. Earnings per share: $6.42, compared to $4.11 last year. Pre-tax profit: $65.3 million, up 48.9%. Gross margin: 23.3%, an increase of 160 basis points [1].

Earnings vs. Forecast

Cavco Industries delivered a strong earnings performance, with EPS of $6.42 surpassing the forecast of $5.55 by 15.68%. Revenue also exceeded expectations at $556.9 million against a forecast of $524.97 million. This performance indicates a positive trend compared to previous quarters, where earnings surprises were less pronounced [1].

Market Reaction

Following the earnings report, Cavco’s stock experienced a 3.13% increase, closing at $403.67. This movement reflects investor confidence in the company’s strong financial performance and strategic initiatives. The stock remains within its 52-week range, with a high of $549.99 and a low of $351.28, suggesting room for further growth. Based on InvestingPro’s Fair Value analysis, the stock appears slightly overvalued at current levels, though analysts maintain positive targets with upside potential [1].

Outlook & Guidance

Cavco remains cautiously optimistic about future market conditions. The company plans to focus on geographic optimization and is exploring the expansion of its consumer lending programs. Despite potential tariff impacts, Cavco is committed to maintaining its growth trajectory through strategic investments and market expansion [1].

Executive Commentary

CEO William C. Bohr emphasized the company’s focus on affordability and strategic investments, stating, "Affordability is coming to the forefront as it has been and should be for the foreseeable future." He also highlighted the company’s capacity expansion efforts: "We’re making some pretty high return investments in our plants, and we’re growing our capacity" [1].

Risks and Challenges

Tariff Impacts: Estimated to affect costs by $2-5.5 million quarterly. Market Saturation: Potential challenges in maintaining growth in a competitive market. Supply Chain Issues: Ongoing global supply chain disruptions could impact production. Macroeconomic Pressures: Economic downturns may affect consumer purchasing power. Input Costs: Fluctuations in raw material prices could impact profitability [1].

References

[1] https://za.investing.com/news/transcripts/earnings-call-transcript-cavco-industries-beats-q1-2026-forecasts-with-strong-eps-93CH-3816884