The Motley Fool is an investment site that has reportedly drawn the ire of industry leaders such as Joe Stegmayer, former president and chairman of Cavco Industries and still MHI Chairman, on more than one occasion. Indeed, such stock and financial news sites, including Seeking Alpha, are often a mixed bag of useful and problematic reports – in part because those writing their analysis may get financials or certain details correct, but may still lack the manufactured home industry specific insights that could make their reporting better.
Rephrased, as with our sources we track, MHProNews takes a ‘wheat and chaff’ approach to their narratives.
With that brief backdrop meant for our growing audience, the Daily Business News on MHProNews turns to a report Wednesday by the Fool’s Lou Whiteman, who disclosed that he “has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.” MHProNews uses a similar disclosure.
As MHProNews has customarily done for years, we often turn quoted text bold and brown to make it pop, but the quotes are otherwise as in the original.
Whiteman said in the report found at this link here that, “Another strong earnings report provides evidence the company’s 2018 acquisition is paying dividends.”
That should be understood in the light of the graphic below, which reflects the 1 year trend on Skyline Champion’s (SKY) stock’s value.
That noted, before diving into the specifics of Whiteman’s analysis of the SKY stock’s recent moves, in the wake of an upbeat report, let’s focus on this pull quote.
“Consistent with our [The Motley Fool’s] previous comments, we remain positive on the outlook for manufactured housing industry, as we see significant runway for continued growth. Industry volumes remain well below the long-term averages, and new financing options are becoming available and are slowly helping close the gap with those historic trends.”
That’s a point that most HUD Code manufactured home industry professionals can agree with, and take some heart in.
But that too must be understood in the light of significant evidence of market manipulation, which is arguably at the heart of why Skyline Champion – or most any other manufactured housing firm – are underperforming. One of several possible examples a newcomer can begin to research is linked below.
The following graphic is a composite from the firm’s website.
That said, back to Whiteman’s narrative. The bullets represent quotes under the subheadings from the Motley Fool.
- Shares of Skyline Champion (NYSE:SKY) climbed 13.9% on Wednesday, after the manufacturer of modular homes reported quarterly results that suggest the company is performing well following a major acquisition last year.
- On Tuesday after the markets closed, Skyline Champion reported fiscal fourth-quarter earnings of $0.26 per share on revenue of $327.7 million, beating the $0.20-per-share consensus earnings estimate despite falling short of the $344.22 million in expected sales. The company was created last June through a merger between Skyline and Champion Enterprises, which created the nation’s largest publicly traded factory-built-housing company.
- Net sales in the quarter grew 23% year over year, and U.S. sales led the way with 35% growth. Skyline Champion reported both a 15% increase in total number of U.S. transactions and a 17% increase in average selling price, as a result of strong demand and favorable product mix. In Canada, sales fell 17% because of a decline in homes sold.
- This is Skyline Champion’s second straight quarterly beat.
- CEO Keith Anderson, on a post-earnings call with investors, said the manufactured-housing market in recent years has grown faster than the broader housing industry. He added that the company expects growth to continue into the new fiscal year:
- Skyline Champion ended the quarter with a backlog of $143 million, down slightly from $155 million a year prior, but the company says the current total is higher quality because it doesn’t include inflated orders for lower-margin Federal Emergency Management Agency residences.
- Based on the stock reaction, investors seem to believe Skyline Champion is building on a solid foundation.
To reiterate in a different way, investors in stocks like SKY ought to demand investigation followed by action about purported market manipulation. The Fool is right in saying there is plenty of upside, but it could be achieved faster and with hefty returns, in the absence of concerns such as those linked herein and below. That’s not only the expert view here, but by others in the industry, as the reports further below reflect.
Special Skyline Champion Report Ahead
MHProNews plans a special report on Skyline Champion in the days ahead. Watch for it. For a prior and other related reports, see below the byline, offers, and notices.
That’s this morning’s second look at “News through the lens of manufactured homes, and factory-built housing” © where “We Provide, You Decide.” © ## (News, analysis, and commentary.)
Your link to industry praise for our coverage, is found here.
For the examples of our kudos linked above…plus well over 1,000 positive, public comments, we say – “Thank You for your vote of confidence.”
“We Provide, You Decide.” © ## (News, analysis and commentary.)
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Submitted by Soheyla Kovach to the Daily Business News for MHProNews.com.
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The last decade-plus has not been especially kind to the manufactured housing industry and consumers of affordable housing. The 21 stCentury began with a great deal of promise for the industry and consumers alike.