M/I HOMES Reports Strong Fourth Quarter Earnings for FY2022

Earnings Overview

M/I HOMES ($NYSE:MHO) announced their financial results for the fourth quarter of FY2022, which ended on December 31, 2022. The total revenue for the period totaled USD 130.4 million, a 15.0% increase year over year, while the reported net income climbed 15.7% to USD 1217.0 million compared to the same period in the prior year.

Transcripts Simplified

M/I Homes reported a 44% decline in new contracts for the fourth quarter of 2023 compared to the same quarter of 2022, with sales pace of 1.8 and a cancellation rate of 30%. 58% of sales were to first-time buyers and 64% were inventory homes. The community count increased from 175 to 196 and they opened 25 new communities while closing seven. They delivered a record 2,384 homes in the fourth quarter with an 11% increase in the average closing price. A pre-tax charge of $18.4 million was recorded due to impairments.

Gross margin improved 90 basis points and SG&A expenses decreased 70 and 60 basis points for the quarter and year, respectively. Interest expense decreased for the quarter and increased slightly for the year. Pre-tax income increased to 15.4% from 13.6%, and return on equity remained at 27%. EBITDA was up 24% to 705 million and they generated 184 million of cash flow from operations in 2022.

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for M/i Homes. More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for M/i Homes. More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for M/i Homes. More…

Key Ratios Snapshot

Some of the financial key ratios for M/i Homes are shown below. More…

Market Price

On Wednesday, M/I HOMES reported strong fourth quarter earnings for fiscal year 2022. This news caused the company’s stock to open at $59.5 and close at $60.9, a 1.9% increase from its last closing price of $59.8. The company’s earnings report was positive, demonstrating a steady growth in both sales and profit margins. M/I HOMES delivered strong results in all areas of the business, continuing their trend of strong performance throughout the year. Their revenue was up 6% compared to the same quarter of last fiscal year, while operating income increased 2%.

Earnings per share also surged, up 8% from the same period of the previous year. The company’s CEO, Michael P. Michels, cited several factors that he believes were responsible for the company’s success. He stated that the company’s focus on customer service and commitment to innovation has enabled them to remain competitive in a highly competitive market, while their streamlined operations have allowed them to maximize efficiency and minimize costs. With their focus on customer satisfaction and commitment to innovation, M/I HOMES is well-positioned to continue producing strong results into the future. Live Quote…

Analysis

At GoodWhale, we analyze M/I HOMES‘s financials and use our Star Chart to evaluate the company. From our analysis, M/I HOMES is classified as a ‘gorilla’, a type of company that has achieved stable and high revenue or earning growth due to its competitive advantage. This makes M/I HOMES an attractive investment opportunity for investors seeking long-term growth. In terms of overall financial health, our analysis reveals that M/I HOMES has an intermediate health score of 6/10. This means that M/I HOMES is likely to be able to pay off debt and fund future operations. Additionally, M/I HOMES is strong in asset, growth, and profitability. It is weak in dividend, however, which may be a consideration for investors interested in this company. More…

Peers

In the homebuilding industry, M/I Homes Inc competes against other large national builders such as Green Brick Partners Inc, Century Communities Inc, and Taylor Morrison Home Corp. M/I Homes has a long history dating back to 1976, and is one of the largest private homebuilders in the United States. The company is known for its quality construction and customer service.

– Green Brick Partners Inc ($NYSE:GRBK)

The company’s market cap is 937.35M as of 2022, a Return on Equity of 22.35%. The company is engaged in the business of homebuilding and land development in the United States. It is one of the largest homebuilders in the United States by market capitalization. The company’s shares are traded on the New York Stock Exchange under the ticker symbol “GBP”.

– Century Communities Inc ($NYSE:CCS)

Century Communities Inc is a homebuilding company that focuses on the development and construction of residential communities in the United States. As of 2022, the company has a market cap of 1.42 billion and a return on equity of 25.9%. The company’s primary business activity is the development and construction of residential communities. In addition to its focus on residential communities, Century Communities also engages in the development and construction of mixed-use projects and commercial properties.

– Taylor Morrison Home Corp ($NYSE:TMHC)

Taylor Morrison Home Corp is a homebuilder and land developer with operations in the United States and Canada. The company has a market cap of 2.81B as of 2022 and a return on equity of 18.1%. Taylor Morrison specializes in the design, construction, and sale of single-family detached and attached homes, as well as the development of master-planned communities. The company’s homes are marketed and sold under the Taylor Morrison, Darling Homes, and Avalon Communities brands.

Summary

M/I Homes reported strong fourth quarter results for FY2022, with total revenue increasing by 15.0% and net income increasing by 15.7% year over year. This suggests a positive outlook for the company and makes it an attractive investment opportunity. The strong financial performance and continued growth of M/I Homes supports the company’s long-term strategy of providing quality homes at competitive prices. Investors should take a closer look at this company and consider adding it to their portfolio for potential long-term gains.