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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Cavco Industries, Inc. (XNAS:CVCO) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
CVCO
Name:
CAVCO INDUSTRIES, INC. (XNAS:CVCO)
Sector:
21.68M
Industry:
Residential Construction
CEO:
Mr. William Boor
Total Employees:
6,300
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -56.25% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF CAVCO INDUSTRIES, INC.(CVCO) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND RESIDENTIAL CONSTRUCTION INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
223.21
One Month Price Target:
$224.66
Six Month Price Target :
$231.89
Likely Price in One Year's Time:
Ticker:
$240.57
Likely Trading Range Today Under (Normal Volatility)
$222.08
Price Upper limit ($) :
$224.66
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$207.78
This week:
$188.71
This month :
$154.21
Other Primary facts
Market Cap:
1.93B
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
8.89M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
15.55%
-21.61%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$294.79
$261.88
$151.63
$184.54
Medium risk (<10%) entry points
Buy Call
Sell Call
$251.17
Buy Put:
Sell Put:
$244.14
$195.16
$202.28
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
CVCO
Sharpe Ratio:
1.91%
Comparison:
CVCO, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is -23.57% lower than the industry
& is -16.22% lower than the market/S&P 500 average
Average Returns/Yield of
CVCO
Daily returns:
0.07%
Weekly returns:
0.37%
Monthly returns:
1.48%
Yearly returns:
23.00%
Comparison of returns:
Average annual returns/yield (last 3 years) is -22.99% below industry average
Classification:
CVCO, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.89
Statistical test of Returns:
CVCO has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.40%
Weekly Volatility:
7.61%
Monthly Volatility:
15.21%
Yearly Volatility:
52.70%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
2.14%
Volatility in last five trading days has been -37.12% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.91%
Weekly VaR:
-15.46%
Monthly VaR:
-30.91%
How Much Can the price of
CVCO
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-26%
Worst case (decline):
>85%
This translates to price declining to:
$164.08
This translates to price declining to:
$33.48
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
CVCO is a 118.17% riskier investment compared to the market/S&P 500 & is 86.91% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -0.35% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
CVCO
Beta in relation to market/S&P 500--1.16
Expected beta in 1 year's time:
0.831
Expected beta in 3 year's time:
1.175
Unlevered (debt free) Beta:
1.123
Beta in relation to Nasdaq (XNAS):
0.704
Beta in relation to all global stocks::
1.008
Beta Comparison & Analysis
Beta of competitors/peers::
1.577
Beta is -26.59% lower than peers
Average Industry Beta:
1.434
Beta is -19.27% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
23.21%
Sustainable growth rate is -17.10% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.066
Alpha is -33.86% below industry average alpha yield
Alpha is 422% higher than market/& is unsustainably high
Analysis of Cost of Capital of
CVCO
Equity cost of capital:
0.111
Equity cost of capital is -14.59% below industry mean WACC
Unlevered (without debt) cost of capital:
10.75%
Before-tax cost of debt:
2.83%
After-tax cost of debt:
2.23%
Overall debt rating:
High AA grade (second highest grade)
Weighted average cost of capital (WACC):
2.23%
WACC is -6.66% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$182.94
Revenue growth rate per share of (3Y):
2.84
Annual revenue growth rate is -9.05% below industry average
EPS:
$21.34
Expected Annual growth rate of EPS (3Y):
34.15%
Expected future EPS growth rate is 79.79% higher than the Residential Construction industry
Free cash flow (FCF) per share:
$13.29
-
-
Debt per share
$2.59
EBITDA per share
$25.15
Valuation Analysis Today of
CVCO
P/E Ratio:
8.91
P/E Ratio of Competitors/Peers:
25.16
P/E ratio is -64.59% lower than main peers & is -2.47% lower than the industry
Stock price/value with industry average P/E ratio: $194.93
CVCO is 14.51% overvalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
1.22
Price to sales ratio is -14.23% below the industry mean
P/B (Price to book value ratio):
2.84
Price to free cash flow: 16.80
-
Net income growth rate (3Y):
22.39%
Net income growth rate is -75.04% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
3.29%
Net debt to equity ratio:
-43.62%
Debt to assets ratio:
2.37%
Net debt to assets ratio:
-31.41%
Debt-to-asset ratio is -94.13% below industry average
Ability to repay debt:
Interest coverage ratio:
318.61
Interest coverage ratio is 243.90% more than industry average
Looking forward:
Debt growth rate:
33.59%
Annual debt growth is 690% higher than industry average debt growth rate
Debt repayment rate in last quarter: 1.89%
Analysis of Key Statistics
Correlation of price movement with the market:
0.448
Statistical significance of correlation:
CVCO has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.555
Stock price is -19.17% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.555
Correlation of price movement with Nasdaq (^IXIC):
0.002
Covariance of price movement with the market:
0.004
Kurtosis
5.957
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.498
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
CVCO
Gross Profit Margin Ratio:
100%
Operating Profit Margin Ratio:
12.44%
Operating profit margin is -8.26% lower than the industry
Net Profit Margin Ratio:
100%
Effective Tax Rate:
6.72%
Effective tax rate is -67.03% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
28.28%
Return on equity (ROE) is -0.93% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
20.36%
Return on assets (ROA) is 37.07% higher than the industry
Financial Leverage:
1.0x
Current Ratio:
2.76
Current ratio is -64.43% below industry average
Cash Conversion Cycle (days):
35.8
Cash conversion cycle is 98.88% above industry average
The remaining useful life of property plant & equipment is: 7.1 years
Stock based compensation to net income ratio:
0.56%
In-depth Efficiency Analysis
Revenue generated per employee:
258.3K
Each employee generates -84% less revenue than industry average revenue per employee
EBITDA generated per employee:
35.5K
Each employee generates -89% less EBITDA than industry average revenue per employee
Profit generated per employee:
31.4K
Each employee generates -87% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
3.4K
Each employee generates -114% less free cash flow than industry average revenue per employee
Assets/Capital per employee
48.1K
Each employee generates -114% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
CVCO
PURPLE INNOVATION, INC. (XNAS:PRPL)
THE REALREAL, INC. (XNAS:REAL)
Smart Share Global Limited (XNAS:EM)
DAVE & BUSTER'S ENTERTAINMENT, INC. (XNAS:PLAY)
1-800-FLOWERS.COM, INC. (XNAS:FLWS)
AMERICAN WOODMARK CORPORATION (XNAS:AMWD)
MALIBU BOATS, INC. (XNAS:MBUU)
XPEL, INC. (XNAS:XPEL)
THE HONEST COMPANY, INC. (XNAS:HNST)
Current Analyst Ratings
Strong buy�4%
Buy�4%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Strong buy
Income Statement
Period:
TTM
Date:
4/2/22
Revenue:
1.63B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
1.22B
408.75M
-
-
206.25M
-
-
206.25M
-
702.00K
11.02M
223.67M
202.50M
197.70M
211.99M
14.25M
197.70M
Statement of Cash Flow
Date:
Period:
1.58M
Differed Income Tax :
- 783.00K
Stock Based Compensation :
1.10M
Change in Working Capital :
- 51977.00K
Accounts Receivables:
- 3659.00K
Other Working Capital:
425.68M
Other Non-Cash Items:
47.31M
Net Cash Provided by Operating Activities:
24.28M
Investments in PP&E:
- 2593.00K
Net Acquisitions:
-
Purchases of Investments:
- 4429.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
7/3/21
2022
Q1
329.75M
19.75M
349.50M
102.10M
150.92M
65.35M
667.86M
114.13M
75.09M
14.19M
38.19M
-
61.41M
303.01M
-
970.87M
30.18M
1.82M
-
48.99M
161.20M
242.19M
23.01M
-
29.62M
-
271.81M
92.00K
458.10M
84.0K
240.79M
July 3, 2021 at 6:00:00 AM
1.42B
699.07M
970.87M
57.94M
24.83M
- 304919.0K
3.37M
38.00K
- 3616.00K
- 444.00K
-
- 12842.00K
-
136.00K
- 13150.00K
-
7.51M
346.82M
339.31M
24.28M
- 2593.00K
21.68M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
CVCO
2023
2024
2025
2026
2027
$241.77
$424.84
$457.88
$493.49
$531.87