Legacy Housing Corp (NASDAQ:LEGH) has reported that Curtis Drew Hodgson, the company's Chairman of the Board and a major shareholder, sold a total of 2,371 shares of company stock in two separate transactions on September 26 and 27. According to the filings, the stock was sold at prices ranging from $27.71 to $27.74 per share, amounting to a total of $65,732.
The first sale on September 26 involved 1,060 shares at an average price of $27.74, while the second sale on September 27 saw 1,311 shares sold at an average price of $27.71. Following these transactions, Hodgson still owns a significant number of shares directly and indirectly through various entities. The filings indicate that Hodgson's direct holdings amount to 631,852 shares after the sales.
In addition to his direct ownership, Hodgson has indirect holdings through Hodgson Ventures, Hodgson 2015 Grandchild's Trust, and Cusach, Inc. The filings reveal that Hodgson Ventures holds 1,000,000 shares, Hodgson 2015 Grandchild's Trust owns 2,669,056 shares, and Cusach, Inc. has 100,000 shares. As per the footnotes in the filings, Hodgson, through his positions in these entities, may be deemed to beneficially own the shares held by them.
Investors and market watchers often pay close attention to insider transactions as they can provide valuable insights into the company's health and the sentiment of its leadership. The sales were executed in accordance with a pre-arranged 10b5-1 trading plan, which allows company insiders to sell shares over a predetermined period of time to avoid concerns about transactions based on insider information.
Legacy Housing Corp, headquartered in Bedford, Texas, specializes in the manufacturing of mobile homes, an industry categorized under the Standard Industrial Classification code 2451. The company has been incorporated in Delaware and has set its fiscal year end on December 31.
For those interested in the company's developments, the recent insider transactions could be a point of reflection, as they consider the potential impact on their investment decisions regarding Legacy Housing Corp stock.
In other recent news, Legacy Housing Corporation has settled $55 million in promissory notes following a series of lawsuits due to a default. The settlement agreement includes the acquisition of two mobile home communities and the issuance of a new two-year promissory note valued at $48 million. This new note, backed by over 1,000 mobile homes and two mobile-home parks in Louisiana, is expected to streamline Legacy's financial recovery process.
In recent developments, Legacy Housing Corporation reported strong first-quarter results, with revenues meeting expectations and a record gross margin leading to earnings per share (EPS) of $0.60, which exceeded the estimated $0.38. Despite a 20% year-over-year decline in the number of home sections sold, the average price per section fell by only 11%.
B.Riley, an analyst firm, has increased its price target for Legacy Housing from $22.00 to $25.00, maintaining a neutral rating on the stock. This adjustment was in response to Legacy Housing's strong first-quarter results and the initiation of a share repurchase for the first time since 2020. B.Riley is closely monitoring Legacy Housing for sustained improvement in gross margins, consistent improvement in unit sales, and realization of potential value from the company's various development properties.
InvestingPro Insights
To complement the recent insider transactions at Legacy Housing Corp (NASDAQ:LEGH), let's delve into some key financial metrics and insights provided by InvestingPro.
Legacy Housing's stock has shown impressive momentum, with InvestingPro data revealing a strong 22.43% return over the last three months and an even more substantial 31.94% return over the past six months. This upward trend aligns with one of the InvestingPro Tips, which highlights the company's "Strong return over the last three months."
Despite the recent insider sales, the company's financial health appears robust. An InvestingPro Tip indicates that Legacy Housing "Operates with a moderate level of debt," which could be seen as a positive sign for potential investors. Additionally, the company's liquid assets exceed its short-term obligations, suggesting a solid financial position.
From a valuation perspective, Legacy Housing's P/E ratio stands at 12.24, which may indicate that the stock is reasonably priced relative to its earnings. The company's profitability is also noteworthy, with InvestingPro data showing a gross profit margin of 50.97% for the last twelve months as of Q2 2024, and an operating income margin of 36.32% for the same period.
It's worth noting that while Curtis Drew Hodgson has sold some shares, he still maintains a significant stake in the company. This, coupled with the InvestingPro Tip that "Analysts predict the company will be profitable this year," may provide some reassurance to investors regarding the company's future prospects.
For those seeking a more comprehensive analysis, InvestingPro offers additional insights, with 7 more tips available for Legacy Housing. These additional tips could provide valuable context for understanding the company's position in the mobile home manufacturing industry and its potential for future growth.
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