Key Highlights

  • Diluted EPS of USD 1.05 beat the consensus estimate of USD 0.72 and rose from USD 0.85 a year earlier.
  • Total revenues of USD 444.5 million rose 10.2% and topped the consensus estimate of USD 438.21 million.
  • Home closings of 1,222 rose 10.4%, while the average sales price per home closed fell 1.2% to USD 367,962.
  • Full year closings guidance was narrowed to 4,600 to 4,800 homes, citing slower sales activity and affordability pressure.

LGI Homes, Inc. (NASDAQ:LGIH) reported third quarter 2026 total revenues of USD 444.5 million, up 10.2% from a year earlier and above a consensus estimate of USD 438.21 million. Diluted EPS was USD 1.05 against USD 0.85 a year earlier and a consensus estimate of USD 0.72, on Net Income of USD 24.6 million compared with USD 19.7 million.

Total closings reached 1,222 homes, including 33 currently and previously leased homes. The 1,189 new homes closed generated homebuilding revenues of USD 437.5 million, up 10.3%. Chairman and Chief Executive Officer Eric Lipar said the quarter delivered growth in closings, Revenue and Earnings alongside a stronger Balance Sheet and more communities.

Margins, Costs and Order Trends

Homebuilding gross Margin was 20.2% and adjusted homebuilding gross margin was 23.7%, both above the midpoint of the previous guidance ranges and up 40 basis points from the second quarter. Selling, general and administrative expenses fell in absolute dollars, and as a share of total revenues they improved 180 basis points. Net income before income taxes was USD 33.3 million against USD 26.7 million. The company ended the quarter with 151 active communities, up 7.1%.

Order activity was weaker over the first nine months. Net orders were 2,869 against 4,098 a year earlier, the cancellation rate was 48.9% against 28.1%, and ending Backlog was 685 homes valued at USD 273.7 million, down from 1,305 homes valued at USD 498.7 million.

Narrowed Closings Guidance and Other 2026 Targets

The company narrowed full year home closings guidance to 4,600 to 4,800 and reiterated the remaining items. Active selling communities are guided to 150 to 160 at year end, average sales price per home closed to USD 360,000 to USD 370,000, homebuilding gross margin to 19.0% to 21.0%, adjusted homebuilding gross margin to 22.5% to 24.5%, SG&A to 15.0% to 16.0% of total revenues and the effective tax rate to about 26.5%.

Mr. Lipar attributed the narrower closings range to slower sales activity in the quarter as affordability pressures weighed on demand. He said the company has broadened its sales process to work with prospective buyers who may need more time to qualify.

Closings Guidance, Orders and Leverage Against Prior Periods

Nine month home closings of 3,435 compare with full year guidance of 4,600 to 4,800, with 1,189 of those closings coming in the third quarter. Nine month net orders fell 30% to 2,869 while the cancellation rate rose to 48.9% from 28.1%. The net Debt to Capital ratio improved to 40.6% from 43.2% at year end 2025, with net debt of USD 1.475 billion against USD 1.596 billion. Liquidity was USD 447.7 million, including USD 69.4 million of cash, and the average sales price of USD 367,962 sits inside the guided range of USD 360,000 to USD 370,000.