New to the board, new to the stock, and trying to understand a couple of things.
The latest financials and slide show from their website predict they should make around $ 10 mil. profit this quarter at their current run rate.
The 11.9% spike in average home price ( $ 263.2 K in the current backlog vs. $ 235.5 K last quarter’s actual ASP) should translate into a gross margin boost to 26.5% ( i.e. 11.9 % on top of 14.6 % last quarters rate), provided inventory costs stay the same -- which they should be for now.
At last quarters backlog close rate of 54%, this quarter’s revenue should be $ 258 Mil (i.e. 1,817 homes in backlog X 54% = 981 homes X $ 263.2 K ASP = $ 258M).
Sales of $ 258 M at a 26.5% margin would yield $ 68.4 M.
Subtract commissions of $ 11.4 M at the 4.4% run rate ( $ 258 X 4.4%) and you now have $ 57 M.
Subtract G&A, Interest, and Depr. at last quarters rate of $ 26.3 M, $ 15.6 M, $ 2.7M and you finish with a profit of $ 12.4 M for the quarter.
Can anybody do a sanity check on my math? Am I missing something?
The other question, are the folks that run this company straight shooters financially or are they likely to stash most of a profit upswing away in some cookie jar for future use?
I think your big assumption is theat margins will increase by the same amount as the increase in sales price. Maybe they are just selling more expensive (larger houses) on more expensive land?? I can't imagine margins will go up more than a few % in one quarter to the next. Have you worked this out any further?