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Century Communities (CCS) Hits Fresh High: Is There Still Room to Run?
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Have you been paying attention to shares of Century Communities (CCS - Free Report) ? Shares have been on the move with the stock up 17.3% over the past month. The stock hit a new 52-week high of $76.05 in the previous session. Century Communities has gained 72.6% since the start of the year compared to the 24.2% move for the Zacks Construction sector and the 28.6% return for the Zacks Building Products - Home Builders industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on April 28, 2021, Century Communities reported EPS of $3 versus consensus estimate of $1.52 while it beat the consensus revenue estimate by 26.71%.
For the current fiscal year, Century Communities is expected to post earnings of $11.73 per share on $4.16 billion in revenues. This represents an 88.59% change in EPS on a 31.71% change in revenues. For the next fiscal year, the company is expected to earn $13.02 per share on $4.73 billion in revenues. This represents a year-over-year change of 11.02% and 13.66%, respectively.
Valuation Metrics
Century Communities may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Century Communities has a Value Score of A. The stock's Growth and Momentum Scores are C and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 6.4X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 11.3X versus its peer group's average of 12.5X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Century Communities currently has a Zacks Rank of #1 (Strong Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Century Communities passes the test. Thus, it seems as though Century Communities shares could have a bit more room to run in the near term.
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Century Communities (CCS) Hits Fresh High: Is There Still Room to Run?
Have you been paying attention to shares of Century Communities (CCS - Free Report) ? Shares have been on the move with the stock up 17.3% over the past month. The stock hit a new 52-week high of $76.05 in the previous session. Century Communities has gained 72.6% since the start of the year compared to the 24.2% move for the Zacks Construction sector and the 28.6% return for the Zacks Building Products - Home Builders industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on April 28, 2021, Century Communities reported EPS of $3 versus consensus estimate of $1.52 while it beat the consensus revenue estimate by 26.71%.
For the current fiscal year, Century Communities is expected to post earnings of $11.73 per share on $4.16 billion in revenues. This represents an 88.59% change in EPS on a 31.71% change in revenues. For the next fiscal year, the company is expected to earn $13.02 per share on $4.73 billion in revenues. This represents a year-over-year change of 11.02% and 13.66%, respectively.
Valuation Metrics
Century Communities may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Century Communities has a Value Score of A. The stock's Growth and Momentum Scores are C and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 6.4X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 11.3X versus its peer group's average of 12.5X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Century Communities currently has a Zacks Rank of #1 (Strong Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Century Communities passes the test. Thus, it seems as though Century Communities shares could have a bit more room to run in the near term.