Champion Homes, Inc. (SKY) stock analysis

P/E above its 5-year median

Champion Homes's P/E of 27.7 is above its own 5-year median of 20.3.

P/E above the industry

Champion Homes's P/E of 27.7 is above the Materials median of 21.9.

EV/EBITDA above its 5-year median

Champion Homes's EV/EBITDA of 15.9 is above its 5-year median of 12.7.

P/B above the industry

Champion Homes's price-to-book of 3.20 is above the Materials median of 2.09.

Trading above fair value

The share price of $93.03 is above our fair value estimate of $73.27.

Margin of safety under 20%

The price is 27.0% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew 0.7% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -19.4% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew -15.8% over the last twelve months, against a 5-year average of 19.5% a year.

Growing faster than the industry

Revenue grew 3.5% over the last twelve months; the Materials median is -1.9%.

Company guidance

No outlook found in earnings releases from the last twelve months.

Gross margin slipping

Gross margin was 25.5% over the last twelve months, against 27.1% a year earlier.

Return on equity under 15%

Return on equity was 11.8% over the last twelve months and averaged 22.5% over five years; we look for 15% on both.

Return on capital over 10%

Return on invested capital was 18.6%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

Champion Homes's return on equity of 11.8% is above the Materials median of 11.4%.

Earnings grew over 5 years

Net income grew 19.5% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 6.8% over the last twelve months, against a 5-year average of 9.9%.

Net margin below the industry

Champion Homes's net margin of 6.8% is below the Materials median of 6.8%.

Low debt

Debt is 0.8% of shareholders' equity, under the 40% we consider low.

Debt falling against equity

Debt to equity fell from 6.9% five years ago to 0.8%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 2157% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term assets cover short-term debts

Current assets are 2.75 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 8.14; above 3 is the safe zone and below 1.8 the distress zone.

No dividend

Champion Homes has not paid a dividend in the last twelve months.

Yield against Treasuries

No dividend.

Yield against the market

No dividend.

Dividend stability

No dividend.

Earnings cover

No dividend.

Cash-flow cover

No dividend.