Cavco's Future Looks Bright as Affordable Housing Demand Soars

After dropping to their lowest level in two years following the Federal Reserve's September rate cut announcement, 30-year fixed-rate mortgages have climbed higher once again. Nonetheless, the environment is looking more favorable for homebuilding companies, as buyers are incentivized to make offers, and companies are better able to access loans to fund development projects and growth.

The top homebuilder stocks include major operations like D.R. Horton Inc. (NYSE: DHI) and Lennar Corp. (NYSE: LEN), each of which closes tens of thousands of homes per year and has a market capitalization of around $50 billion or more. With interest rates expected to continue to fall in future FOMC meetings over the coming months, there may be more space in the competitive homebuilding market for smaller players as well. Cavco Industries Inc. (NASDAQ: CVCO) is one such small homebuilding stock that nonetheless warrants investor attention.

Manufactured Home Builder Ready to Address Housing Crisis

Cavco is a mid-cap firm that manufactures pre-fabricated homes and other buildings as well as RVs. It also provides financing for customers through a financial services division. Given the significant need for affordable housing throughout the U.S.—there is a shortage of an estimated 7.3 million rental homes for renters with extremely low incomes. ...