Champion Homes (NYSE:SKY) Stock Price Up 6.9% - Here's Why

Key Points

• Champion Homes (NYSE:SKY) saw a stock price increase of 6.9%, trading at $65.09 on Friday, up from a previous close of $60.90.
• Research firms have downgraded the company's price target, with Royal Bank of Canada lowering it to $82.00 and Barclays to $72.00, while the consensus rating remains a "Hold."
• The company initiated a $50 million stock buyback plan, indicating management's belief that its shares are currently undervalued.

Shares of Champion Homes, Inc. (NYSE:SKY - Get Free Report) shot up 6.9% during mid-day trading on Friday . The company traded as high as $64.62 and last traded at $65.09. 839,139 shares changed hands during mid-day trading, an increase of 33% from the average session volume of 631,837 shares. The stock had previously closed at $60.90.

Analysts Set New Price Targets

Several research firms recently weighed in on SKY. Royal Bank Of Canada lowered their target price on Champion Homes from $96.00 to $82.00 and set a "sector perform" rating on the stock in a research report on Wednesday, May 28th. Barclays reduced their price objective on Champion Homes from $97.00 to $72.00 and set an "equal weight" rating on the stock in a research note on Wednesday, May 28th. Finally, Zelman & Associates raised Champion Homes from a "strong sell" rating to a "hold" rating in a research note on Thursday, June 5th. Six analysts have rated the stock with a hold rating and one has given a buy rating to the stock. Based on data from MarketBeat.com, the stock presently has a consensus rating of "Hold" and a consensus price target of $80.60.

Champion Homes Trading Up 1.5%

The company has a market capitalization of $3.81 billion, a price-to-earnings ratio of 19.41 and a beta of 1.13. The company has a fifty day moving average of $64.55 and a 200-day moving average of $82.70. The company has a current ratio of 2.41, a quick ratio of 1.61 and a debt-to-equity ratio of 0.02.

Champion Homes (NYSE:SKY - Get Free Report) last posted its quarterly earnings data on Tuesday, May 27th. The company reported $0.65 earnings per share for the quarter, missing analysts' consensus estimates of $0.75 by ($0.10). The company had revenue of $593.87 million for the quarter, compared to analysts' expectations of $595.42 million. Champion Homes had a return on equity of 13.61% and a net margin of 7.99%. The firm's revenue was up .7% compared to the same quarter last year. During the same period in the prior year, the company posted $0.62 EPS. As a group, equities research analysts anticipate that Champion Homes, Inc. will post 3.63 earnings per share for the current fiscal year.

Champion Homes announced that its Board of Directors has approved a stock buyback program on Friday, May 30th that permits the company to buyback $50.00 million in outstanding shares. This buyback authorization permits the company to buy up to 1.3% of its shares through open market purchases. Shares buyback programs are often a sign that the company's board of directors believes its shares are undervalued.

Institutional Investors Weigh In On Champion Homes

Several institutional investors have recently modified their holdings of SKY. Capital World Investors raised its holdings in Champion Homes by 31.5% in the 4th quarter. Capital World Investors now owns 2,638,862 shares of the company's stock valued at $232,484,000 after acquiring an additional 632,718 shares during the last quarter. Alliancebernstein L.P. boosted its position in Champion Homes by 67.1% during the 1st quarter. Alliancebernstein L.P. now owns 1,716,459 shares of the company's stock worth $162,652,000 after purchasing an additional 689,265 shares during the period. Ameriprise Financial Inc. boosted its position in Champion Homes by 17.2% in the 4th quarter. Ameriprise Financial Inc. now owns 1,646,482 shares of the company's stock valued at $145,055,000 after buying an additional 241,326 shares during the last quarter. Capital Research Global Investors purchased a new position in Champion Homes in the 4th quarter valued at about $98,978,000. Finally, Goldman Sachs Group Inc. boosted its position in Champion Homes by 63.7% in the 1st quarter. Goldman Sachs Group Inc. now owns 1,007,639 shares of the company's stock valued at $95,484,000 after buying an additional 392,159 shares during the last quarter.

About Champion Homes

Skyline Champion Corporation produces and sells factory-built housing in North America. The company offers manufactured and modular homes, park models RVs, accessory dwelling units, and modular buildings for the multi-family and hospitality sectors. It builds homes under the Skyline Homes, Champion Home Builders, Genesis Homes, Athens Park Models, Dutch Housing, Atlantic Homes, Excel Homes, Homes of Merit, New Era, Redman Homes, ScotBilt Homes, Shore Park, Silvercrest, and Titan Homes brands in the United States; and Moduline and SRI Homes brand names in western Canada.