LGI Homes Q3 Earnings: Beat Estimates, YoY Decline

**LGI Homes Exceeds Q3 Expectations Despite Broader Market Headwinds**

The Woodlands, TX – LGI Homes Inc. (NASDAQ: LGIH) announced stronger-than-expected financial results for the third quarter of 2023, significantly outpacing Wall Street analyst forecasts for both earnings and revenue, even as the broader housing market grapples with elevated interest rates.

For the quarter ending September 30, 2023, the national homebuilder reported adjusted earnings of $4.42 per share. This figure comfortably surpassed the average analyst estimate of $4.01 per share, indicating robust operational performance. On the top line, LGI Homes generated $711.2 million in revenue, also exceeding the consensus analyst projection of $674.5 million.

While the current period showcased strong execution, the results represent a year-over-year decline compared to the third quarter of 2022, which saw adjusted earnings of $5.04 per share and revenue of $795.5 million. This dip reflects the broader slowdown in the housing market influenced by rising mortgage rates and affordability challenges.

During the quarter, LGI Homes posted a net income of $95.5 million. The company successfully closed on 2,166 homes, with the average sales price recorded at $328,382. LGI Homes maintains a national platform, operating in numerous states and focusing primarily on the first-time and entry-level homebuyer segment.

“Our third-quarter performance demonstrates the resilience of our business model and the strong execution of our team in a dynamic housing market,” said Eric Lipar, Chairman and CEO of LGI Homes, in a recent earnings call. “Despite higher interest rates impacting buyer affordability, demand for our quality, affordable homes remained solid, supported by limited existing home inventory and our strategic use of interest rate buydowns and other buyer incentives.”

The housing market in Q3 2023 was characterized by some of the highest mortgage rates seen in decades, which typically slows down home sales. However, a persistent shortage of existing homes for sale has channeled many prospective buyers toward new construction, providing a tailwind for homebuilders like LGI Homes. Analysts note that builders who effectively manage inventory, offer targeted incentives, and operate efficiently are best positioned to navigate these conditions.

Looking ahead, LGI Homes provided updated guidance for the full year 2023, anticipating total home closings to be between 7,400 and 7,700 homes, with an average sales price ranging from $325,000 to $330,000. This forward outlook suggests a continued focus on their core affordable product and disciplined operational strategies.

Investors seeking more details can review LGI Homes’ official earnings release and SEC filings on their investor relations page: https://investors.lgihomes.com/. Further industry analysis can often be found from real estate research firms like the National Association of Home Builders: https://www.nahb.org/.