It was good to be a public home builder in 2013, and good, too, to go public. After a nine-year hiatus, six private companies raised more than $1.4 billion in growth capital by selling equity shares in their operations to join the ranks of their public peers. Investors bought into housing’s recovery in a big way, which gave big public builders easy, cheap access to capital. Our report cards this year reflect what the group as a whole and individual organizations did with that capital, and how they managed opportunity and positioned themselves for 2014’s further challenges.
Our key take away is this: One year a housing recovery does not make. If we look only at year-over-year comparisons and contrasts as benchmarks of strategic and tactical skill, we’d absolutely miss what stronger companies do to build resilience, prepare for shocks, and prosper no matter what.
Two caveats here: One, our grades are editors’ choices, not to be taken as qualified evaluations of company financial management. That’s the ratings agencies’ business, not ours. Two, to arrive at an “apples to apples” comparison, we map all disclosed company data to a calendar year, so numbers may differ from those reported in fiscal-year earnings reports. The research presented here is the best we’ve done in the seven years we’ve been grading the publics, and that’s thanks to the leadership of Jamie Pirrello, president of American New Homes Group, and his team, Kylie Berrena, Derek Heath, and Robert Yemola, students in the accounting, business, and economics department at Juniata College in Huntingdon, Pa.