From Financial Modeling Prep: 2025-06-17 06:51:00

S&P Global Ratings downgraded LGI Homes Inc. to B+ on June 16, 2025, due to weaker earnings and high leverage. The Woodlands-based homebuilder faces a negative outlook as debt metrics are expected to be strained in a challenging market. Absorption rates are forecasted to decline to 3.2 home sales per community per month, impacting selling prices and margins. Leverage metrics remain elevated, with debt/EBITDA projected at 5.5x-6x by year-end 2025. Liquidity is adequate, with $302.4 million drawn on a $1.1825 billion revolver. Further downgrades may occur if debt/EBITDA remains high or interest coverage falls. Monitoring LGI’s operational performance is crucial for investors amid industry challenges.



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