Public Information to Follow
- National Multifamily Housing Committee (NMHC)
- Dodge Data & Analytics
- National Association of Home Builders
Financial Model Considerations
- Irregular cash flow
- Seasonality of work and cyclicality of the construction business
- Variability of building material costs
- Monitoring forecasted material costs is the utmost importance when providing estimates for projects
- Timely collection of payments
- Profit drivers
- Accurate estimates
- Project management and scheduling skills
- Relationships with quality general contractors and subcontractors
Recent Industry Metrics (Companies <$5M revenue)
Highlights from this vertical analysis and financial ratios:
- Salaries and wages are growing faster than owners wages, and likely to continue to rise in 2023
- The ability to cover interest payments increased faster than the need for long term debt
- Despite rising costs, returns on assets have increased over the previous three years
- Cash and other short term assets are higher than pre-pandemic (current ratio)
For more information on building financial models see here.
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