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.