Key Highlights

  • LGIH shares rose 1.86% pre-market to $48.30 after third-quarter results.
  • Third-quarter Earnings of $1.05 per share compared with a $0.72 consensus.
  • Full-year home closings guidance narrowed to between 4,600 and 4,800.

LGI Homes (NASDAQ:LGIH) shares rose 1.86% to $48.30 in pre-market today, up $0.88 from the prior close of $47.42. The gain follows a 6.87% advance at Monday's close. The company reported third-quarter results before the open, with earnings of $1.05 per diluted share against a consensus of $0.72 and $0.85 a year earlier. Homebuilding Revenue of $437.5 million compared with a market estimate of $438.2 million and rose 10.3% from the prior year.

The Woodlands, Texas-based company, founded in 2003, designs, builds and sells entry-level attached and detached homes and active adult homes under the LGI Homes brand, along with luxury homes under the Terrata Homes brand. It operates across 36 markets in 21 states and has closed more than 80,000 homes.

Closings Rise 10.4% as Margins Improve Sequentially

Total home closings were 1,222, including 33 currently and previously leased homes, an increase of 10.4%. Closings of new homes were 1,189, up 11.6%, at an average sales price of $367,962, down 1.2%. Total revenues reached $444.5 million, up 10.2%.

Homebuilding gross Margin was 20.2% and adjusted homebuilding gross margin was 23.7%, both above the midpoint of previous guidance and up 40 basis points sequentially. SG&A declined in absolute dollars, and SG&A as a percentage of total revenues improved 180 basis points. Net Income was $24.6 million, compared with net income before taxes of $33.3 million.

Net Debt to Capital stood at 40.6%, a 420 basis point improvement from a year earlier. Total Liquidity was $447.7 million, including $69.4 million of cash and $378.3 million available under the revolving Credit facility. The company ended the quarter with 151 active communities, up 7.1%.

Orders, Cancellations and the Narrowed 2026 Outlook

The company now expects 2026 home closings of 4,600 to 4,800, narrowed from a prior range with a high end of 5,400. Management said the revised outlook reflects slower sales activity in the quarter as affordability pressures weighed on demand, and that it is leaning into sales and Marketing strategies to improve sales pace.

For the nine months ended September 30, net orders were 2,869 compared with 4,098, and the cancellation rate was 48.9% compared with 28.1%. Ending Backlog was 685 homes valued at $273.7 million, compared with 1,305 homes valued at $498.7 million.

Other 2026 guidance was maintained: 150 to 160 active communities, an average sales price between $360,000 and $370,000, homebuilding gross margin between 19.0% and 21.0%, adjusted homebuilding gross margin between 22.5% and 24.5%, SG&A of 15.0% to 16.0% of revenues and an effective tax rate near 26.5%.

Sales Pace and Fourth-Quarter Closings Are the Next Checkpoints

LGI Homes reported higher closings, revenue and earnings alongside lower nine-month orders, a higher cancellation rate and a narrower closings range. The next items to follow are the conference call scheduled for today, fourth-quarter closings against the 4,600 to 4,800 range, and the sales pace management says it is working to improve.