LGI Homes (NASDAQ: LGIH) is one of 24 public companies in the “Homebuilding” industry, but how does it contrast to its competitors? We will compare LGI Homes to similar companies based on the strength of its valuation, dividends, institutional ownership, profitability, earnings, analyst recommendations and risk.

Profitability

This table compares LGI Homes and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
LGI Homes 9.26% 25.51% 11.10%
LGI Homes Competitors 9.77% 15.04% 8.11%

Risk and Volatility

LGI Homes has a beta of 0.27, suggesting that its share price is 73% less volatile than the S&P 500. Comparatively, LGI Homes’ competitors have a beta of 1.52, suggesting that their average share price is 52% more volatile than the S&P 500.

Institutional and Insider Ownership

92.0% of LGI Homes shares are owned by institutional investors. Comparatively, 78.9% of shares of all “Homebuilding” companies are owned by institutional investors. 13.6% of LGI Homes shares are owned by insiders. Comparatively, 13.1% of shares of all “Homebuilding” companies are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for LGI Homes and its competitors, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LGI Homes 0 4 2 0 2.33
LGI Homes Competitors 284 1687 1929 38 2.44

LGI Homes currently has a consensus target price of $53.00, indicating a potential downside of 26.02%. As a group, “Homebuilding” companies have a potential downside of 4.28%. Given LGI Homes’ competitors stronger consensus rating and higher possible upside, analysts plainly believe LGI Homes has less favorable growth aspects than its competitors.

Earnings and Valuation

This table compares LGI Homes and its competitors gross revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
LGI Homes $838.32 million $75.03 million 16.58
LGI Homes Competitors $3.89 billion $231.12 million 510.62

LGI Homes’ competitors have higher revenue and earnings than LGI Homes. LGI Homes is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Summary

LGI Homes competitors beat LGI Homes on 9 of the 13 factors compared.

LGI Homes Company Profile

LGI Homes, Inc. is a homebuilder and land developer. The Company is engaged in the design, construction, marketing and sale of new homes in markets in Texas, Arizona, Florida, Georgia, New Mexico, South Carolina, North Carolina, Colorado, Washington and Tennessee. The Company operates through five segments: the Texas division, the Southwest division, the Southeast division, the Florida division and the Northwest division. The Texas division includes homebuilding operations in Houston, Dallas/Fort Worth, San Antonio and Austin locations. The Southwest division includes homebuilding operations in Phoenix, Tucson, Albuquerque, Denver and Colorado Springs locations. The Southeast division includes homebuilding operations in Atlanta, Charlotte and Nashville locations. The Florida division includes homebuilding operations in Tampa, Orlando, Fort Myers and Jacksonville locations. The Northwest division includes homebuilding operations in Seattle location.

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