Cavco Industries to acquire American Homestar for $190M in cash

Cavco Industries plans to acquire American Homestar Corp. for $190 million in cash, with the deal expected to close in Q3 2025.

American Homestar operates two manufacturing facilities and nineteen retail locations, generating revenues of $194 million as of May 31, 2025.

The acquisition aims to enhance Cavco's earnings and operational cash flow while creating potential operational efficiencies and expanding its market presence in Texas and surrounding states.

Cavco will finance the acquisition entirely through its cash reserves and intends to retain significant cash for future strategic initiatives following the transaction.

Investment Recommendation Rating: Excellent Opportunity

Cavco Industries (NASDAQ: CVCO) announced on Monday its intention to acquire American Homestar Corp., a manufactured homebuilder and retailer based in Houston, Texas, for a total of $190 million in cash.

American Homestar operates two manufacturing facilities and nineteen retail locations. The company is involved in writing and selling a limited number of manufactured home loans, while also serving as an agent for third-party insurance providers. As of May 31, 2025, American Homestar reported revenues amounting to $194 million.

The acquisition is anticipated to close in the third quarter of 2025 and will be financed entirely through Cavco's available cash reserves.

Cavco anticipates that this acquisition will enhance earnings and operational cash flow. Furthermore, the company sees potential for operational efficiencies and cost synergies arising from this integration. This strategic move will also broaden Cavco's footprint across Texas and nearby states.

Following this significant cash investment, Cavco aims to retain a considerable amount of cash to facilitate ongoing strategic initiatives.