What Happened?

Shares of modular home and building manufacturer Champion Homes (NYSE:SKY) jumped 11.1% in the morning session after the company reported fourth-quarter results that significantly exceeded analysts' sales volume expectations. Sales grew 15.3% year-on-year, driven by a 14.1% increase in US homes sold and a 2.8% rise in the average selling price per home​. Gross margin expanded to 28.1%, benefiting from higher sales through company-owned retail centers and lower input costs​. EPS beat analysts' expectations, with growth of 30.9% supported by this margin expansion. Guidance was not explicitly stated in the report, but backlog trends showed a mixed picture, up year on year, but down sequentially​. Zooming out, we think this was a good quarter with some key areas of upside.

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What The Market Is Telling Us

Champion Homes’s shares are somewhat volatile and have had 14 moves greater than 5% over the last year. But moves this big are rare even for Champion Homes and indicate this news significantly impacted the market’s perception of the business.

Champion Homes is up 21.4% since the beginning of the year, and at $104.34 per share, it is trading close to its 52-week high of $108.92 from December 2024. Investors who bought $1,000 worth of Champion Homes’s shares 5 years ago would now be looking at an investment worth $3,587.

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