UPDATE: LGI Homes (LGIH) Tops Q2 EPS by 13c, Beats on Revenues; Offers FY EPS Guidance Above Consensus
LGI Homes (NASDAQ: LGIH) reported Q2 EPS of $1.39, $0.13 better than the analyst estimate of $1.26. Revenue for the quarter came in at $324.18 million versus the consensus estimate of $317.64 million.
Outlook
Subject to the caveats in the Forward-Looking Statements section of this press release, the Company offers the following updated guidance for 2017. The Company believes it will have between 75 and 80 active selling communities at the end of 2017, close more than 5,000 homes in 2017, and generate basic EPS between $4.25 and $4.75 per share during 2017. In addition, the Company believes 2017 gross margin as a percentage of home sales revenues will be in the range of 25.0% and 27.0% and 2017 adjusted gross margin (non-GAAP) as a percentage of home sales revenues will be similar to previous years in the range of 26.5% and 28.5% with capitalized interest accounting for substantially all of the difference between gross margin and adjusted gross margin. The Company also believes that the average home sales price in 2017 will be between $210,000 and $220,000. This outlook assumes that general economic conditions, including interest rates and mortgage availability, in the remainder of 2017 are similar to those in the first half of 2017 and that average home sales price, construction costs, availability of land, land development costs and overall absorption rates for 2017 are consistent with the Company’s recent experience.
Second Quarter 2017 Results and Comparisons to Second Quarter 2016
- Net Income increased 55.9% to $32.2 million, or $1.49 Basic EPS and $1.39 Diluted EPS
- Net Income Before Income Taxes increased 54.9% to $48.6 million
- Home Sales Revenues increased 45.6% to $324.2 million
- Home Closings increased 34.0% to 1,511 homes
- Average Home Sales Price increased 8.7% to $214,545
- Gross Margin as a Percentage of Homes Sales Revenues was 26.6% as compared to 26.5%
- Adjusted Gross Margin (non-GAAP) as a Percentage of Home Sales Revenues was 28.0% as compared to 27.8%
- Ending backlog increased 74.2% to 1,545 units
- Active Selling Communities at June 30, 2017 increased to 71 from 56
- 32,689 Total Owned and Controlled Lots at June 30, 2017
GUIDANCE:
LGI Homes sees FY2017 EPS of $4.25-$4.75, versus the consensus of $4.13.
For earnings history and earnings-related data on LGI Homes (LGIH) click here.