Century Communities (CCS) to Build 598 Homesites in Austin
Century Communities, Inc. CCS inked a new joint development project deal with Green Brick Partners, Inc. GRBK in Austin, TX. GRBK is one of the fastest-growing public homebuilders and it will enhance CCS’ convenient online or in-person homebuying process.
Per the deal, both companies have purchased approximately 165 acres of land in Braker Valley with the intent to build 598 homesites with a mix of 45-foot and 50-foot front-entry lots.
Braker Valley is located at the junction of Blue Goose Road and Cameron Road in northeast Austin and is convenient to downtown Austin and the Pflugerville area.
Construction is slated to begin in early 2025 and CCS and Trophy Signature Homes (a Green Brick subsidiary) anticipates opening it for sales in the third quarter of the same year.
Shares of this homebuilder gained 0.53% in the trading session on Oct 9, 2023.
Expansion Bodes Well
Century Communities continues to focus on increasing its community count. At the end of second-quarter 2023, the community count increased by 20 communities to 233, up from the prior-year quarter’s level of 213.
During the second quarter of 2023, net new contract homes increased 3.8% compared with the prior year period and increased 14.6% sequentially. Cancellation rates were 14%, representing significant improvements from the prior-year period.
The company continues to focus on its strategy. Revenues and deliveries improved respectively by 12% and 17%, sequentially during the second quarter. With the increasing market demand for homes experienced during the second quarter of 2023, CCS began to reduce incentive offerings across the communities, which, along with improving construction costs and cycle times, contributed to a strong homebuilding gross margin of 21%.
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Shares of the company have underperformed the Zacks Building Products - Home Builders industry in the past six months.
Zacks Rank & Key Picks
The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Toll Brothers TOL: Based in Horsham, PA, Toll Brothers is a leading builder of luxury homes. The company has been benefiting from its strategy of broadening its product lines, price points and geographies. Also, it has been gaining from the lack of competition in the luxury new home market, its build-to-order approach and its solid backlog level. This, combined with its focus on operational efficiency, has been helping TOL drive growth. Meanwhile, the company has been strategically adding more affordable luxury communities because of current demographic trends and expanding its footprint and customer base. These communities are expected to be more capital-efficient.
TOL currently sports a Zacks Rank #1. Earnings estimates for fiscal 2023 have increased to $11.91 per share from $10.61 per share over the past 60 days. The company’s earnings topped the Zacks Consensus Estimate in all the trailing four quarters, the average being 31.4%.
KB Home KBH: Based in Los Angeles, KB Home has been gaining from prudent growth plans, a solid existing geographic footprint and a built-to-order approach.
KBH currently sports a Zacks Rank #2 (Buy). The Zacks Consensus Estimate for fiscal 2023 earnings of $6.92 per share has increased from $6.83 over the past seven days. The company’s earnings topped the Zacks Consensus Estimate in three of the trailing four quarters and missed on one occasion, the average being 26.7%.
About GRBK
Green Brick is a publicly traded, diversified homebuilding and land development company operating in Texas, Georgia and Florida. It is engaged in all aspects of the homebuilding process, including land acquisition and development, entitlements, design, construction, marketing and sales for its residential neighborhoods and master-planned communities.
The company specializes in building quality neighborhoods interwoven with the latest technological advancements. GRBK also enjoys several strategic advantages, such as a significant footprint in markets with some of the biggest job growth and best demographics in the United States, superior land and lot pipeline and the diversity of its product lines, which bode well for its growth.
GRBK currently carries a Zacks Rank #3. Its earnings for 2023 are expected to decline 2%.
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