Legacy Housing Corp's (NASDAQ:LEGH) Chairman of the Board, Curtis Drew Hodgson, has sold a portion of his stock in the company, according to a recent filing with the Securities and Exchange Commission. The transaction involved the sale of 14,420 shares at an average price of $27.96 per share, totaling approximately $403,183.
The sale was executed on September 23rd and was reported in a filing dated September 24th. Following this transaction, Hodgson still maintains a significant stake in Legacy Housing Corp, with direct ownership of 633,421 shares. Additionally, Hodgson has indirect ownership through entities such as Hodgson Ventures, Hodgson 2015 Grandchild's Trust, and Cusach, Inc., which collectively hold over 3.7 million shares. These indirect holdings are due to Hodgson's positions within these entities, as noted in the footnotes of the SEC filing.
Legacy Housing Corp, based in Bedford, Texas, specializes in the manufacturing of mobile homes, a sector known by its SIC code as Mobile Homes [2451]. The company operates under the trading symbol LEGH and is incorporated in Delaware.
The reported sale was carried out under a pre-arranged 10b5-1 trading plan, which allows company insiders to establish predetermined trading plans for selling stocks at a time when they are not in possession of material non-public information. This can help to avoid any potential concerns about insider trading.
It's worth noting that such filings with the SEC are routine and provide transparency about the transactions of company insiders. Investors often monitor these filings to gain insight into the actions of company executives and board members, which may reflect their perspective on the company's current valuation and future prospects.
For further details on the transaction, interested parties can refer to the full Form 4 filing with the SEC.
In other recent news, Legacy Housing Corporation has made significant strides in its financial recovery process. The company has settled approximately $55 million in promissory notes, following a series of lawsuits due to a default by the makers. As part of the settlement agreement, Legacy will receive clear title and possession of two mobile home communities in Texas and Mississippi. To refinance the remaining debt, a new two-year promissory note valued at $48 million will be issued, backed by over 1,000 mobile homes and two parks in Louisiana.
In addition to these developments, Legacy Housing has reported strong financial results. The company's first-quarter earnings per share (EPS) of $0.60 surpassed the estimated $0.38, bolstered by record gross margins. Despite a year-over-year decline in the number of home sections sold, the average price per section showed recovery from the previous quarter.
B.Riley, an analyst firm, has responded to these recent developments by increasing its price target for Legacy Housing from $22.00 to $25.00, while maintaining a neutral rating. The firm has noted Legacy's consistent value creation and will be monitoring for sustained improvements in gross margins and unit sales. These recent developments highlight Legacy Housing's ongoing efforts to improve its financial position and performance.
InvestingPro Insights
As Legacy Housing Corp (NASDAQ:LEGH) navigates the market, recent actions by company insiders like Chairman Curtis Drew Hodgson's stock sale can draw investor attention. To provide further context to these developments, InvestingPro offers some insights into LEGH's financial health and market performance.
InvestingPro data shows that Legacy Housing Corp has a market capitalization of approximately $661.32 million, with a price-to-earnings (P/E) ratio of 12.3, which aligns closely with the adjusted P/E ratio for the last twelve months as of Q2 2024, sitting at 12.28. This valuation metric suggests that the stock is trading at a level consistent with the company's earnings. Additionally, the company's price to book ratio as of the same period stands at 1.43, indicating that the market values the company at a slight premium over its book value.
Despite a challenging environment reflected by a revenue decline of around 28.94% in the last twelve months as of Q2 2024, Legacy Housing Corp has maintained a strong gross profit margin of 50.97%. This profitability indicator is crucial as it demonstrates the company's ability to control production costs and generate earnings.
Investors may also take note of LEGH's stock performance, with a significant 6-month price total return of 39.74%, underscoring a robust short-term growth in the stock's value. This could be a signal of market confidence in the company's operations and future outlook.
Among the InvestingPro Tips, two particularly stand out for Legacy Housing Corp. Firstly, analysts have highlighted that the company's liquid assets exceed its short-term obligations, which is a positive sign of financial stability. Secondly, LEGH is expected to be profitable this year, as per analyst predictions, which is reassuring for investors considering the company's future earnings potential.
For those seeking a deeper dive into Legacy Housing Corp's financials and market predictions, InvestingPro offers additional tips, including insights on debt levels, return performance, and dividend policies. Currently, there are 5 more InvestingPro Tips available for LEGH, which can be accessed for detailed analysis and investment guidance.
These insights and data points can help investors make more informed decisions in light of recent insider trading activity and the company's broader financial picture.
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