Smith Douglas Homes Corp. Class A (SDHC) AI Stock Analysis

• Market Cap: $869.09M
• Dividend Yield: N/A
• Average Volume (3M): 46.24K
• Price to Earnings (P/E): 9.3
• Beta (1Y): 0.91
• Revenue Growth: 28.67%
• EPS Growth: -18.20%
• Country: US
• Employees: 445
• Sector: General
• Sector Strength: N/A
• Industry: Real Estate - Development
• EPS (TTM): 0.30
• Shares Outstanding: 8,991,378
• 10 Day Avg. Volume: 52,633
• 30 Day Avg. Volume: 46,245
• PEG Ratio: -0.10
• Price to Book (P/B): 2.30
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 11.27
• Enterprise Value/Market Cap: 0.19
• Enterprise Value/Revenue: 0.05
• Enterprise Value/Gross Profit: 0.63
• Enterprise Value/Ebitda: 0.34
• 1Y Price Target: $18.13
• Price Target Upside: 9.09% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

• Rating: 63 Neutral
• Price Target: $17.50 ▲( 5.29% Upside)

The overall score of 63 reflects a mixed outlook. The company's strong financial performance and improved leverage are offset by significant revenue and cash flow declines. Technical analysis indicates bearish momentum, while valuation suggests potential undervaluation. The earnings call highlights operational strengths but also notes challenges ahead. Positive corporate events enhance financial flexibility, contributing to a balanced, albeit cautious, outlook.

Positive Factors

Earnings

SDHC's Q4 deliveries at 836 were nicely ahead of the guide and estimates, showcasing impressive performance.

Financial Performance

SDHC's balance sheet, cycle times, and return on equity are very favorable compared to peers, highlighting strong financial health.

Negative Factors

Backlog

The backlog at year-end was down 24% year-over-year, reflecting a shrinking trend in the industry.

Cost Pressures

Smith Douglas Homes faces headwinds from cost inflation, with rising lot costs contributing to gross margin pressure.

Order Performance

Orders missed estimates, indicating challenges in meeting demand expectations.

Smith Douglas Homes Corp. Class A Business Overview & Revenue Model

Company Description

Smith Douglas Homes Corp. engages in the design, construction, and sale of single-family homes in the southeastern United States. The company operates in metropolitan Atlanta, Birmingham, Charlotte, Huntsville, Nashville, Raleigh-Durham, and Houston. It also provides closing, escrow, and title insurance services. The company was founded in 2008 and is headquartered in Woodstock, Georgia.

How the Company Makes Money

Smith Douglas Homes Corp. makes money primarily through the sale of residential properties. The company generates revenue by acquiring land, developing it into residential communities, and constructing homes that are sold to customers. Key revenue streams include the sale of completed homes and, to a lesser extent, land development projects. The company's earnings are influenced by housing market conditions, customer demand, and efficient cost management during the construction process. Partnerships with suppliers for materials and regional real estate agents also play a significant role in driving sales and managing costs.

Smith Douglas Homes Corp. Class A Financial Statement Overview

Summary

Smith Douglas Homes Corp. Class A exhibits strong profit margins and improved leverage ratios, indicating operational efficiency and reduced financial risk. However, the substantial drop in revenue and cash flows from 2023 to 2024 is concerning and suggests potential challenges in the market or operational strategy. The company must focus on revenue growth strategies to complement its strong profitability and leverage position.

Income Statement

The company's revenue has declined significantly from 2023 to 2024, dropping by over 66%. Despite this, the gross profit margin remains robust at 100% in 2024, suggesting effective cost management. However, the net profit margin dropped from 16% to approximately 44%, indicating increased profitability relative to the reduced revenue. The EBIT and EBITDA margins improved, reflecting efficient operations. Overall, while the margins are strong, the sharp revenue decline is a concern.

Balance Sheet

The company's debt-to-equity ratio improved significantly from 0.37 in 2023 to 0.04 in 2024, indicating a much lower reliance on debt. The equity ratio also improved from 0.59 to 0.15, showing a stronger equity position. However, the absolute decrease in stockholders' equity is a notable concern. Overall, the balance sheet demonstrates improved leverage and equity stability, but the reduction in total equity warrants attention.

Cash Flow

The operating cash flow has decreased from 2023 to 2024, but the company still maintains a positive free cash flow. The free cash flow to net income ratio improved, suggesting better cash conversion efficiency. However, the overall decrease in cash flows needs to be monitored. The cash flow management appears stable, with effective capital expenditure control, but reduced cash generation is a potential risk.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement		Total Revenue
975.46M	764.63M	755.35M	518.86M
	Gross Profit
255.54M	216.33M	222.75M	122.95M
	EBIT
119.16M	123.89M	139.49M	58.72M
	EBITDA
121.21M	124.97M	140.35M	65.72M
	Net Income Common Stockholders
16.07M	123.18M	140.44M	62.53M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
22.36M	19.78M	29.60M	25.34M
	Total Assets
475.90M	352.69M	223.37M	201.19M
	Total Debt
12.07M	78.40M	18.39M	74.41M
	Net Debt
-10.29M	58.63M	-11.21M	49.07M
	Total Liabilities
74.17M	143.79M	58.86M	105.67M
	Stockholders Equity
73.63M	208.90M	164.51M	95.52M
Cash Flow		Free Cash Flow
15.24M	74.95M	131.09M	30.14M
	Operating Cash Flow
19.13M	76.26M	132.09M	30.87M
	Investing Cash Flow
-4.71M	-76.83M	361.00K	847.00K
	Financing Cash Flow
-11.84M	-9.25M	-128.19M	-38.54M

Smith Douglas Homes Corp. Class A Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 16.62
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SDHC, the sentiment is Negative. The current price of 16.62 is below the 20-day moving average (MA) of 19.23, below the 50-day MA of 19.32, and below the 200-day MA of 27.85, indicating a bearish trend. The MACD of -0.46 indicates Positive momentum. The RSI at 36.51 is Neutral, neither overbought nor oversold. The STOCH value of 3.80 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SDHC.

Smith Douglas Homes Corp. Class A Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FPH	74 Outperform	$612.04M	4.36	12.27%	―	11.66%	78.44%
FOR	70 Outperform	$1.00B	5.73	10.81%	―	-5.60%	-17.86%
LSEA	70 Outperform	$408.52M	41.96	1.50%	―	24.15%	-60.70%
SDHC	63 Neutral	$869.09M	9.34	23.11%	―	28.67%	-18.20%
Sector *	56 Neutral	$4.82B	18.20	-17.81%	5.19%	13.68%	-27.95%
ARL	54 Neutral	$215.15M	―	-2.20%	―	-6.48%	-592.10%
XIN		$14.89M	0.42		―	―	―

Smith Douglas Homes Corp. Class A Corporate Events

Smith Douglas Homes Amends Credit Agreement with Wells Fargo

On May 15, 2025, Smith Douglas Holdings LLC and its subsidiaries amended their existing credit agreement with Wells Fargo Bank and other financial institutions. The amendment increased the total revolving commitments to $325 million, extended the loan maturity date to May 15, 2029, and revised financial covenants, enhancing borrowing flexibility and potentially impacting the company’s financial operations and market positioning.

The most recent analyst rating on (SDHC) stock is a Hold with a $36.00 price target. To see the full list of analyst forecasts on Smith Douglas Homes Corp. Class A stock, see the SDHC Stock Forecast page.