I presume that LGIH will experience a delay in construction activities. Maybe 2-3 weeks delay out of the 12 week quarter in the Houston area? Maybe a week in the San Antonio area?
In the most recent quarter 43% of LGIH’s revenue came from the Central division. Last time I checked, LGIH had 78-79 selling communities.
LGIH has 14 selling communities in the Houston metro area (getting hit hard now).
LGIH has 6 selling communities in the San Antonio area (in the part of Harvey).
Also, people aren’t going to buying homes during the hurricane and during the extended cleanup. 18% of LGIH’s communities are in the Houston metro area. Hurricane Harvey will negatively affect LGIH’s Q3 results.
And Austin will experience some effects too. LGIH has 3 selling communities in Austin and a 4th that will open soon.
LGIH will suffer head winds from lack of labor and supplies through the next year.
Also, people aren’t going to buying homes during the hurricane and during the extended cleanup.
I would have thought that enough people will be without housing that demand would pick up in the aftermath. Of course nobody can sell more than 100% of what they have, so that would at best shift some sales to be earlier.
Likely labor will be a problem. People with damaged homes will be bidding up skilled labor prices. Add the boom in nearby West Texas fracking to that.
It is hard enough to find people willing to work in normal times.
I have been through several hurricanes. Except for Katrina type disasters, homes are usually damaged rather than totaled. Flooding is worse than wind, but it will be boom time for roofers.
I don’t own LGTH and would buy it only on a substantial price reduction because of this hurricane.