Street Calls of the Week
PHOENIX - Cavco Industries, Inc. (NASDAQ:CVCO) has completed its acquisition of American Homestar Corporation and its subsidiaries for $190 million, the company announced Tuesday. The acquisition comes as Cavco demonstrates robust financial health, with InvestingPro data showing the company holds more cash than debt on its balance sheet and maintains a strong current ratio of 2.88x.
The transaction, initially revealed on July 14, was finalized on Monday and funded entirely with cash on hand. American Homestar, which operates under the Oak Creek Homes brand, brings two manufacturing facilities and nineteen retail locations to Cavco’s portfolio. This strategic move adds to Cavco’s impressive performance, with the company achieving a 16.6% revenue growth in the last twelve months and maintaining healthy profit margins of ~22%.
"We are grateful to Buck Teeter, Dwayne Teeter and the entire American Homestar team for their trust in joining us," said Bill Boor, President and Chief Executive Officer of Cavco.
American Homestar, founded in 1971, operates as a vertically integrated factory-built housing company with locations across Texas, Louisiana and Oklahoma. The company also writes and sells manufactured home loans and acts as an agent for third-party insurers.
Cavco, headquartered in Phoenix, is one of the largest producers of manufactured and modular homes in the United States. The company also produces park model RVs, vacation cabins, and factory-built commercial structures.
The acquisition is subject to customary post-closing adjustments, according to the press release statement. Based on InvestingPro analysis, Cavco appears to be trading above its Fair Value, with the stock recently hitting new 52-week highs. Investors seeking deeper insights can access comprehensive analysis and 10+ additional ProTips through InvestingPro’s detailed research reports, available for over 1,400 US stocks including CVCO.
In other recent news, Cavco Industries reported impressive financial results for the first quarter of fiscal year 2026, outperforming analyst expectations. The company announced earnings per share of $6.42, which was significantly higher than the projected $5.55, representing a 15.68% surprise. Additionally, Cavco Industries achieved revenue of $556.9 million, surpassing the anticipated $524.97 million. These results indicate a strong performance for the company, highlighting its ability to exceed market forecasts. The earnings announcement was a key development for investors, reflecting the company’s robust financial health. Analysts had projected lower figures, making the actual results noteworthy. This financial performance has positioned Cavco Industries positively in the market, drawing attention from both investors and analysts.
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