Executive Summary
Cavco Industries reported solid QQ2 2026 results with revenue of $556.5 million, up 9.7% year over year, and a gross profit of $134.4 million translating to a gross margin of 24.15%. Operating income reached $62.18 million and net income was $52.38 million, yielding an EPS of $6.63 (diluted $6.54). The company generated robust operating cash flow of $78.47 million and free cash flow of $68.74 million, while ending the period with a notably strong net cash position (net debt of -$344.62 million) and a cash balance of roughly $400 million. Management also deployed capital through share repurchases totaling $36.09 million, underscoring a shareholder-friendly deployment of excess liquidity.
The quarterly performance reflects favorable mix and ongoing efficiency gains in Cavco’s two-segment model (Factory-Built Housing and Financial Services). Despite a modest QoQ revenue dip of about 0.06%, margin discipline and scale-driven cost optimization supported meaningful YoY margin expansion: operating margin around 11.17% and net margin near 9.41%. Free cash flow generation remains a standout attribute, enabling optionality for continued opportunistic capital returns, selective growth initiatives, and balance-sheet resilience in a cyclical housing environment.
Looking ahead, Cavco’s leverage-free balance sheet and strong cash flow position the company well to weather cyclical headwinds in housing while potentially capturing share from a constructive macro backdrop for affordable, factory-built housing. Key determinants for investors include the pace of demand in manufactured housing, mortgage financing environment, input costs, and potential incremental opportunities in Cavco’s Financial Services segment and cross-selling opportunities across its diversified brand portfolio.
Key Performance Indicators
Key Insights
Revenue: $556.53 million (+9.67% YoY; -0.06% QoQ)
Gross Profit: $134.41 million (+15.75% YoY; +3.78% QoQ)
Operating Income: $62.18 million (+26.57% YoY; +3.02% QoQ)
Net Income: $52.38 million (+19.55% YoY; +1.43% QoQ)
EPS: $6.63 (diluted $6.54; YoY +24.39%; QoQ +2.16%)
EBITDA: $61.65 million (margin ~11.08%)
EBITDARatio: 0.1108
Operating Cash Flow: $78.47 million
Free Cash Flow: $68.74 million
Balance Sheet: Cash & equivalents $374.98 million; Net cash position of -$344.62 million; ...
Financial Highlights
Revenue: $556.53 million (+9.67% YoY; -0.06% QoQ)
Gross Profit: $134.41 million (+15.75% YoY; +3.78% QoQ)
Operating Income: $62.18 million (+26.57% YoY; +3.02% QoQ)
Net Income: $52.38 million (+19.55% YoY; +1.43% QoQ)
EPS: $6.63 (diluted $6.54; YoY +24.39%; QoQ +2.16%)
EBITDA: $61.65 million (margin ~11.08%)
EBITDARatio: 0.1108
Operating Cash Flow: $78.47 million
Free Cash Flow: $68.74 million
Balance Sheet: Cash & equivalents $374.98 million; Net cash position of -$344.62 million; Total assets $1.449 billion; Total current liabilities $318.05 million; Total stockholders’ equity $1.086 billion
Liquidity: Current ratio ~2.94; Quick ratio ~1.84
Capital Allocation: Share repurchases $36.09 million; Net cash provided by operating activities $78.47 million; Investing activities show modest capital expenditure and selective investments; Financing activities negative $34.51 million.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
556.53M |
9.67% |
-0.06% |
| Gross Profit |
134.41M |
15.75% |
3.78% |
| Operating Income |
62.18M |
26.57% |
3.02% |
| Net Income |
52.38M |
19.55% |
1.43% |
| EPS |
6.63 |
24.39% |
2.16% |
Management Commentary
No earnings-call transcript data was provided in the supplied materials. As a result, there are no management quotes available to anchor the qualitative themes (strategy, operations, market conditions) within this report. Once transcript content is accessible, we will extract and group quotes by theme with context and significance.
Forward Guidance
No formal forward guidance was provided in the supplied data. Given Cavco’s strong quarterly free cash flow generation and net cash position, the company appears well-positioned to pursue accretive capital allocation and selective growth opportunities, including potential expansion of its brand network, optimization of financial services financing, and continued cost discipline. Key factors for monitoring include: (1) demand trajectory for manufactured housing amid macro housing cycles and mortgage-rate environment; (2) financing yields and mortgage origination activity within Cavco Financial Services; (3) raw material costs and manufacturing efficiency; (4) capital allocation choices (buybacks vs. capex vs. opportunistic tuck-in acquisitions); and (5) regulatory developments affecting financing and insurance offerings in the manufactured home sector.