Analyzing William Lyon Homes (WLH) and The Competition

William Lyon Homes (NYSE: WLH) is one of 20 public companies in the “Operative builders” industry, but how does it contrast to its peers? We will compare William Lyon Homes to similar businesses based on the strength of its dividends, institutional ownership, analyst recommendations, valuation, earnings, risk and profitability.

Analyst Ratings

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This is a summary of current ratings for William Lyon Homes and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
William Lyon Homes 0 2 2 0 2.50
William Lyon Homes Competitors 241 922 810 52 2.33

William Lyon Homes currently has a consensus price target of $33.00, indicating a potential upside of 21.77%. As a group, “Operative builders” companies have a potential downside of 0.96%. Given William Lyon Homes’ stronger consensus rating and higher possible upside, analysts clearly believe William Lyon Homes is more favorable than its peers.

Profitability

This table compares William Lyon Homes and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
William Lyon Homes 2.68% 10.51% 4.12%
William Lyon Homes Competitors 2.30% 7.26% 5.34%

Earnings and Valuation

This table compares William Lyon Homes and its peers revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
William Lyon Homes $1.80 billion $48.13 million 12.26
William Lyon Homes Competitors $4.18 billion $223.65 million 13.75

William Lyon Homes’ peers have higher revenue and earnings than William Lyon Homes. William Lyon Homes is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Risk and Volatility

William Lyon Homes has a beta of 1.53, suggesting that its share price is 53% more volatile than the S&P 500. Comparatively, William Lyon Homes’ peers have a beta of 1.10, suggesting that their average share price is 10% more volatile than the S&P 500.

Institutional and Insider Ownership

81.9% of William Lyon Homes shares are owned by institutional investors. Comparatively, 78.0% of shares of all “Operative builders” companies are owned by institutional investors. 22.1% of William Lyon Homes shares are owned by company insiders. Comparatively, 15.4% of shares of all “Operative builders” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

William Lyon Homes beats its peers on 8 of the 13 factors compared.

About William Lyon Homes

William Lyon Homes, together with its subsidiaries, designs, constructs, markets, and sells single-family detached and attached homes in California, Arizona, Nevada, Colorado, Washington, and Oregon. It sells its homes primarily to entry-level, and first-time and second-time move-up homebuyers, as well as to luxury home and active adult markets under the Village Homes and Polygon Northwest Homes brands through in-house commissioned sales personnel and outside brokers. As of December 31, 2017, the company owned approximately 13,256 lots and had options to purchase an additional 4,180 lots. William Lyon Homes was founded in 1954 and is headquartered in Newport Beach, California.

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