Higher Deliveries to Aid Century Communities' (CCS) Q1 Earnings

Zacks Equity Research

April 22, 2024 at 12:32 p.m.·4 min read

Century Communities, Inc. CCS is set to report its first quarter 2024 results on Apr 24, 2024, after market close.

In the last reported quarter, the company’s earnings and total revenues topped the Zacks Consensus Estimate by 29.1% and 31.6%, respectively. On a year-over-year basis, the top and the bottom lines grew 2.2% and 8.1%, respectively.

The Trend in Estimate Revision

The Zacks Consensus Estimate for first-quarter 2024 earnings per share is pegged at $1.55, suggesting a 49% increase from the year-ago quarter’s reported figure of $1.04.

The consensus mark for total revenues is pegged at $791.7 million, suggesting a 5.1% increase from the year-ago quarter’s value of $753 million.

In-Depth Discussion

Facilitating in the homebuilding industry, Century Communities is likely to have been impacted by the increasing mortgage rates and existing inflation, which have taken a bid on homebuyer’s affordability. Nonetheless, the company’s initiative of offering affordable homes along with several incentive offerings including lot premiums, interest rate buydowns and discounts on base home prices, is likely to have more than offset these headwinds in the to-be-reported quarter.

Also, its focus on building homes on a spec basis is likely to have bode well. This initiative of the company helps in direct cost control, sparks the availability of quick move-ins and assures buyers of financing certainty. Furthermore, despite the improving inventory of existing home sales, the company is likely to have benefited from increasing new home contracts, thanks to its improved cycle times and increased level of home starts.

The Zacks Consensus Estimate for first-quarter 2024 total homebuilding revenues is pegged at $774 million, up from $737 million reported in the year-ago period. Home deliveries in the quarter are expected to be 2,046 units, up 7% year over year. Also, the to-be-reported quarter’s ASP of home deliveries is expected to be down 2.1% to $377,000 year over year

Given the improving trend, the first-quarter 2024 consensus mark for net new home contracts is pegged at 2,911 units, up 44% from 2,022 units reported in the year-ago period. The backlog is anticipated to increase to 1,967 units from 1,920 units reported in the year-ago period.

Century Communities’ bottom line is likely to have increased year over year in the first quarter, thanks to its cost-controlling initiatives. The reduction in direct construction costs is likely to have added to the uptrend. The company’s focus on affordability along with the reduced cycle times and cost-reduction initiatives positions it well for the to-be-reported quarter and beyond.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Century Communities this time around. The company does not have the right combination of two key ingredients — a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — to increase the odds of an earnings beat.

Earnings ESP: Century Communities has an Earnings ESP of 0.00%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Zacks Rank: CCS currently carries a Zacks Rank of 3.

Stocks Poised to Beat Earnings

Here are some companies in the Zacks Construction sector, which have the right combination of elements to post an earnings beat in the quarter to be reported.

Willdan Group, Inc. WLDN has an Earnings ESP of +47.37% and currently sports a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.

WLDN’s earnings topped the Zacks Consensus Estimate in three of the last four quarters and met on the remaining one occasion, with the average surprise being 886.3%. Earnings for the to-be-reported quarter are expected to decline 40.6% from last year quarter’s reported figure.

Summit Materials, Inc. SUM presently has an Earnings ESP of +28.52% and a Zacks Rank of 3.

SUM’s earnings for the to-be-reported quarter are expected to gain 7.7% from last year quarter’s reported figure. The company reported better-than-expected earnings in each of the last four quarters, the average surprise being 18.2%.

Dream Finders Homes, Inc. DFH has an Earnings ESP of +7.14% and currently flaunts a Zacks Rank of 1.

DFH’s earnings for the to-be-reported quarter are expected to increase 55.6% from last year quarter’s reported figure. The company reported better-than-expected earnings in the trailing four quarters, the average surprise being 144.9%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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Century Communities, Inc. (CCS) : Free Stock Analysis Report

Willdan Group, Inc. (WLDN) : Free Stock Analysis Report

Summit Materials, Inc. (SUM) : Free Stock Analysis Report

Dream Finders Homes, Inc. (DFH) : Free Stock Analysis Report

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The Trend in Estimate Revision

In-Depth Discussion

What the Zacks Model Unveils

Stocks Poised to Beat Earnings

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