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News Tip – Cavco Industries Legal Woes with SEC, Insider Insights

June 21st, 2019 No comments

 

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Over a dozen law firms and scores of attorneys on all sides of the Joe Stegmayer controversy have poured over what has transpired before, during, and since Cavco Industries announced on November 8, 2018 the Securities and Exchange Commission (SEC) subpoena that sent their stock’s (CVCO) value plunging.

 

The Daily Business News on MHProNews routinely hears from a variety of well-placed sources related to this matter.

 

Among them, an attorney sent the following.

Checking the SEC-EDGAR system, Cavco has filed an amendment to their 2019 Shareholder meeting proxy form relating to the Board and Committee meetings attended by each Board member — no substance, just numbers — but look at the number of meetings and “sessions” related to the SEC Stegmayer investigation

The entire tip, which is according to information submitted to the SEC, follows. A key line, not to be missed in what follows, is this pull-quote:

  • “…the Board and the committees of the Board held during fiscal 2019. Page 13 of the Original Proxy Statement included disclosures that there thirty-three (33) Audit Committee meetings in fiscal year 2019 for both regular or SEC Investigation matters, of which eighteen (18) were Sessions. This disclosure was incorrect; there were forty-eight (48) Audit Committee meetings in fiscal year 2019 for both regular or SEC Investigation matters, of which thirty-three (33) were Sessions.”

With that tee up, here is the formal Cavco supplemental proxy statement, as provided.

 

____________________________

 

This Proxy Statement Supplement (“Supplement”) provides additional, clarifying and corrective information with respect to the Cavco Industries, Inc. (“Cavco” or the “Company”) 2019 Annual Meeting of Stockholders, to be held on July 9, 2019 at 9:00 AM (local time), at the Company’s corporate offices located at 3636 North Central Avenue, Suite 1200, Phoenix, Arizona 85012.

On or about June 6, 2019, the Company filed with the SEC and mailed to our stockholders of record as of May 24, 2019 a proxy statement (the “Original Proxy Statement”) describing the matters to be voted on at the Annual Meeting. All capitalized terms used in this Supplement and not otherwise defined herein have the meaning ascribed to them in the Original Proxy Statement. This Supplement should be read in conjunction with the Original Proxy Statement. 

The Original Proxy Statement included various disclosures and tables describing and disclosing the number of meetings of the Board, the Audit Committee, the Compensation Committee and the Corporate Governance and Nominating Committee that were attended by each of the Company’s directors during fiscal 2019.

This Supplement is being provided to supplement, clarify and correct certain of these disclosures relating to the number of total meetings of the Board and the committees of the Board held during fiscal 2019. Page 13 of the Original Proxy Statement included disclosures that there thirty-three (33) Audit Committee meetings in fiscal year 2019 for both regular or SEC Investigation matters, of which eighteen (18) were Sessions. This disclosure was incorrect; there were forty-eight (48) Audit Committee meetings in fiscal year 2019 for both regular or SEC Investigation matters, of which thirty-three (33) were Sessions.

The table and narrative below replaces in its entirety the table and narrative on page 16 of the Original Proxy Statement under the heading “Board and Committee Meetings” to: (i) provide corrected information with respect to the number of Audit Committee meetings in 2019 consistent with the previous paragraph, (ii) provide the total number of meetings for the Board, the Audit Committee, the Compensation Committee, the Corporate Governance and Nominating Committee and the Legal Compliance & Oversight Committee, and (iii) provide supplemental clarifying disclosure about the directors attendance at Board and committee meetings during fiscal 2019.

CavcoIndustriesCVCOProxySupplmentalStatementSECfilingManufacturedHousingIndustryMHProNews

Click on this image and download, then open, to see the full size for easier reading.

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MHProNews asked one of the attorneys to comment, and received this response: “…what’s especially interesting is the large number of meetings and “sessions” of the audit committee relating to the investigation…Also speculation, but I have to think that what’s happening is potentially serious, based on the amount of time that’s obviously being put into it and other steps they’ve taken.” 

Put differently, there is a lot of defense going on, which implies that there is plenty of offense facing Cavco by shareholder plaintiff’s attorneys, the feds, and perhaps others at play too.

Oddly, Stegmayer has continued on as MHI Chair.

ManufacturedHousingInstituteLogoMHIBoardOfDirectorsLogoMHIExecutiveCommittee

The satirical logo is used in part to poke with a lighter touch at a serious topic. As some have framed it, there are white hat companies at MHI, and black hat companies.

 

For added context and history, see the related reports, further below the bylines and notices.

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That’s today’s second installment of “News through the lens of manufactured homes, and factory-built housing,” © where “We Provide, You Decide.” ©. ## (News, fact-checks, analysis, commentary.)

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Joe Stegmayer, Cavco Industries, MHI Chairman, Insights from Innovative Housing Showcase

June 11th, 2019 Comments off

 

JoeStegmayerCavcoIndustriesManufacturedHousingInstituteMHIChairmanInsightsInnovativeHousingShowcaseMHProNews

With enough patience, facts and patterns in dispute often reveal themselves more clearly to those with an open mind who are honestly seeking clarity. By definition, the closed-minded can’t be reasoned with.

 

This report will have two primary components.  The first will be from the recent and positive Innovative Housing Showcase, held at the National Mall in Washington, D.C. Joe Stegmayer, former Chairman, President, and CEO of Cavco Industries was prominent there.  The second will look again at a leadership and related questions that keep arising at Cavco.

 

MHI Chairman Stegmayer At Recent Innovative Housing Showcase in Washington, D.C.

Five U.S. congressmen and several other senior government officials took tours, said Joseph Stegmayer, Cavco’s former chairman and CEO,” said Phoenix metro’s AC Central, a Gannett media publication that is part of the USA Today network.

This is one of the best unsubsidized ways to promote affordable housing,” Stegmayer said of manufacturing housing, per that same source.  He said that factory-built homes can be made at about half the cost of comparable dwellings built on site.

Some other facts, per AZ Central:

·        Cavco exhibited a 1,050 square foot home with two bedrooms and two baths that was built at one of its two factories in Virginia that retails for about $64,000.  What they didn’t specify was that it was the lone single sectional on display in the National Mall in Washington, D.C.  Skyline Champion displayed two multi-sectional models.

·        Cavco was one of 19 exhibitors at the National Mall and teamed with UMH Properties, a real estate investment trust or REIT that owns and operates manufactured-home communities around the nation.

This was the only news report found on line as of the date and time shown about the publicly traded firm’s (CVCO) involvement in the project. We’ll return to that factoid later.

 

CavcoIndustriesInnovativeHousingShowcaseAZCentralArizonaRepublicUSATodayGannettNewsDailyBusinessNewsMHProNews

 

In the MHI branded video below, Stegmayer says: “Manufactured Housing is so much of an untold story. It has come a long way in a short number of years. And now were providing homes that rival anything built on site at half the cost. And so, to meet the affordable housing crisis in this country, and there truly is a need for affordable housing, manufactured housing can go a long way to doing that.”

 

 

Stagmayer continued by saying, “We can provide a home for millions of people who otherwise can not afford a home and would be renting for the rest of their lives. Here [he’s standing in a manufactured home] they can buy a home, build equity, just like any other home owner. And, ah, stay in that home for years or resell it and move up to a larger home if someday they get a larger family.”

A lot of flexibility in manufactured housing.  A lot of sustainability,” Stegmayer said during his portion of the video. Let’s note in fairness that these are very similar points that MHLivingNews, MHProNews and scores of others have made about our industry. Our publisher has noted that the firms involved in the Innovative Housing Showcase are to be applauded. On the thrust of several of these points by Stegmayer, we’d editorially concur.

But what follows in that same video is both true and troubling.  It gets near a central issue that is hampering manufactured home industry growth.

 

Manufactured Housing Professionals, HUD Secretary Ben Carson, Must Promote These Two Words

 

Secretary Ben Carson, as the head of HUD, made this National Mall opportunity available in conjunction with the National Association of Home Builders (NAHB). Dr. Carson explains that they encouraged local municipalities to look at manufactured homes and look at their regulations.  Carson said there may have been reasons in the past for some regulations, but no longer.  Why hasn’t the HUD Secretary mentioned “enhanced preemption?”  Is it possible that he’s not been briefed on that point by HUD staff? 

But more questions arise from this MHI branded video and recent mainstream media reports.

Looking again at MHI’s chairman’s comment, it isn’t as if the manufactured home industry has suddenly appeared out of nowhere and has an “untold story,” as Stegmayer framed it.  Indeed, Arlington, VA based MHI – a location not far from the National Mall – claims to have told that story to millions of people.  See their claim to that effect illustrated in their own still from an MHI video, below.

If so, the public literally are not buying what MHI is selling, based on recent new manufactured home production and shipment trends.

Look at the stills from the late 2018 MHI self-touting video and compare it to the fact that manufactured housing has had 8 months of consecutive year-over-year decreases in shipment levels.

 

ManufacturedHousingInstituteMHINewClassofHomesDailyBusinessNewsMHProNews

Most people think of momentum as forward motion.  Does it mean something different to MHI?  Momentum for more consolidation? Still from MHI Video, logos added by MHProNews.

ManufacturedHousingInstituteLogoMHIVideoStillMHIPromotionalClaims

That downturn is now into month number 8.

 

Further, manufactured homes are not an untold story at all.

As the AZ Central story reflected, starting with the headline, a HUD Code manufactured home is errantly termed a ‘mobile home.’  Over the years, has Cavco or MHI failed to brief that media outlet, which issues periodic reports on hometown firm Cavco, about the proper terminology to be used?  If not, then they are not following the logic of their own prior chairman, who said this.

TimWilliams21stMortgageCorpGoodArgumentsQuoteRespondEveryStoryDailyBusinessNewsMHproNews

The story most told is a painfully familiar one to anyone who tracks news coverage about ‘mobile homes’ and ‘manufactured homes.’  The bulk of the reports are negative, as the screen capture below indicates.

MobileHomesNewsGoogleSearchDailyBusinessNewsMHProNews

While the evidence is anecdotal, it is also not disputed by live audience of manufactured home industry professionals when they are asked:

·        does the public here more bad news or good news about manufactured homes? 

·        Is the impression conveyed in third party reports largely positive one, or largely negative?

·        Manufactured home industry professionals almost universally agree that the image is a problematic one.

That being so, it is not an untold story. Rather, it is a told story that is all-too-often being mistakenly framed.

Where is MHI’s effective response to that largely undisputed fact?  Because it is obvious that their claim of millions exposed to their advertorials – if true – has not worked. The shipment numbers and other research proves that point.  Further, only 8 percent of home shoppers, per Zillow, considered a manufactured home in research that firm did.  Many of those who considered a manufactured home never bought one. Put yourself briefly in the shoes of a possible manufactured home customer. If they simply googled news about ‘mobile homes’ or ‘manufactured homes,’ wouldn’t that explain why – given that much reporting is negative – that the public literally isn’t buying one?

 

Zillow2016HomeBuyersSurveyManufacturedHousingIndustryDailyBusinessNewsMHProNews

Only 8 percent of housing shoppers considered a mobile or manufactured home, and many of those did not buy one

 

What do those third party research facts say about the effectiveness of the industry?  So Stegmayer’s own words about the “untold story” – seen through that lens – is troubling at best.  The screen capture from the date and time shown is but one example. 

 

MobileHomesNewsGoogleSearchDailyBusinessNewsMHProNews

 

Furthermore, there is no evidence that HUD Secretary Carson has been advised about enhanced preemption.  MHProNews has asked officials at HUD to respond to that concern.  They have no comment on that now.

Why not?  Doesn’t their failure to comment on such a straightforward question itself raise concerns that perhaps Secretary Carson has not been brief about enhanced preemption?

Stegmayer has had face time with Secretary Carson on numerous occasions in the last year or so.  Did Cavco’s former president, and the man who is still MHI’s chairman, not raise the issue of “enhanced preemption?”  If not, why not?

HUDBenCarsonJoeStegmayerCavcoDailyBusinessNewsMHProNews

These are questions that Cavco’s shareholders – among others – ought to be asking.

If the report by AZ Central is accurate, and only 5 congressional representatives bothered to come and see what MHI dubbed Homes on the Hill.  That too suggests something was missed by MHI, doesn’t it?  There are 535 members of the U.S. House (435) and Senate (100). Numbers of those in Congress get contributions from MHI’s PAC.  So why did such a small group of representatives come over a 5 day event?

The MHI “Homes on the Hill” videos are a fine idea. 

·        The videos are well done in a technical sense.

·        But where is the promotion for those videos? 

·        Why is it that the MHI video posted above that was published on Jun 2, 2019, after a week online, has only 732 views, per YouTube, as of 4:49 PM ET on 6.9.2019? Ponder the point that John Oliver’s viral hit on numbers of MHI members errantly named “Mobile Homes” has had over 6 million hits on YouTube in about 2 months. That’s the graphic comparison that industry professionals, investors, and advocates must ponder.  Stegmayer’s choice of words ‘the untold story’ is not supported by facts.  The story about manufactured homes has been told millions of times.  It simply hasn’t cut through the negative noise. 

Where has that negative noise about manufactured housing originated from?  The sources are varied. That said, there is a money trail in the millions that clearly points to donations by Warren Buffett, chairman of Berkshire Hathaway – parent to Clayton Homes, their sister Berkshire lenders, and a powerhouse at MHI – that have flowed via the Tides nonprofit to groups such as MHAction or Prosperity Now that have in turn attacked manufactured housing operations.  Rephrased, Buffett’s been backing both pro-and-con voices about manufactured homes.  The voices that undermine the industry’s story seem to win the media war routinely. Why?

None of the Berkshire brands or MHI has denied the evidence presented. That leaves the evidence presented unchallenged.  The collage below illustrates the point just made.

 

MHActionLogoWarrenBuffettGeorgeSorosPhotoTidesFoundationLogoDailyBusinessNewManufacturedHomeIndustryMHProsNews

 

Now, against that backdrop, let’s pivot back to Cavco’s November 8, 2018 news release.

 

Stegmayer, Cavco, and the SEC/Shareholder Legal Clouds 

As the numbers of shareholders suits against Cavco Industries continues to grow, an interesting point keeps arising relative to Joe Stegmayer, their former Chairman, President, and CEO. Let’s mention that he was also a former Clayton Homes division president.

Part of the announcement on November 8, 2019 that sent Cavco shares plunging related to Stegmayer was that the multi-year leader of the publicly traded firm (CVCO) would step down into a more supportive, non-executive role.

But several indications from sources previously reported within Cavco, plus more recent hints by George Allen and others in his orbit, suggest that Stegmayer still exercises a leadership role that some believe is more like that of the shadow president than some supportive ‘non-executive’ role.

Quoting from their November 8th press release, “Mr. Stegmayer stepped down from his position as Chairman, President and Chief Executive Officer of the Company after an internal investigation, conducted by independent legal counsel, identified certain violations of Company policy related to securities trading activities conducted by Mr. Stegmayer. The Board’s decision to transition Mr. Stegmayer to a non-executive role allows the Company to retain his deep industry and operational experience.

The Cavco press release further stated that, The Company also announced that it had received a subpoena from the Securities and Exchange Commission’s Division of Enforcement (“SEC”) requesting certain documents relating to, among other items, trading of the stock of another public company. Subsequent to sending the Company a subpoena, the SEC sent a subpoena for documents and testimony to Joseph Stegmayer, regarding similar issues. The Company has initiated an independent investigation and intends to cooperate fully with the SEC’s investigation.

In a typical ‘all in the company family’ motif, the release said: Joseph Stegmayer, former Chairman, President and Chief Executive Officer, commented that “Dan Urness is a great choice to lead Cavco. He is a strong leader, with the ability to connect with customers, partners and teammates. His institutional knowledge of our Company and significant industry experience will ensure a smooth leadership transition. I look forward to continuing to serve the Company in my new role.”

ManufacturedHousingInstituteLogoMHIBoardOfDirectorsLogoMHIExecutiveCommittee

The satirical logo is used in part to poke with a lighter touch at a serious topic. As some have framed it, there are white hat companies at MHI, and black hat companies.  Certainly the black hats must find the white hats useful.

Stegmayer has remained Chairman of the Manufactured Housing Institute (MHI), despite the legal flap, its costs to Cavco, and the hit on CVCO’s stock valuation.

 

YahooFinanceCavcoIndustriesCVCO1YearTrendDailyBusinessNewsMHProNews

Cavco (CVCO) is one of the stocks tracked in our evening/nightly market report, along with a snapshot of headlines, and news that move investors. For Friday’s report, click here.

 

These are questions that may be of interest to shareholder’s plaintiff’s attorneys.

 

Cavco Industries Investigated Anew for Violations of Federal Securities Laws, plus Manufactured Home Industry Stock Updates

 

But there are broader industry questions that ought to be explored, perhaps in concert with Congressional and other state/federal inquiries.

Readers will be reminded that some 5 years ago, Stegmayer was talking on camera about the industry returning to 250,000 shipments.  That video is found in the report in the text/image box above. Stegmayer did say that return to 250,000 could accomplished in a year.  But he clearly suggested that it was doable in the foreseeable future.  What happened to that 250,000 new home shipment aim since then? 

Why is a new manufactured home shipment goal unmentioned by MHI more recently? 

Or ponder the fact that after the embarrassing reply the MHI President and CEO Richard ‘Dick’ Jennison gave to MHProNews on camera that same year – that the industry should grow slowly – the next year, after being privately chastened by Tim Williams, per sources, Jennison said that the industry could return to 500,000 new manufactured home shipments.  We professionally concur that that half-million or more new home production goal is achievable.  Others in the industry believe so too. The points Secretary Carson has cited in various interviews and his speech in New Orleans all point to the great potential of the industry in this affordable housing crisis.

 

MHI CEO Dick Jennison’s Pledge – 500,000 New Manufactured Home Shipments

 

All of which begs the question, how effective has MHI been at representing “all segments of manufactured housing?” 

As the decade de facto post-production association, after decades in that role, has MHI still not figured out what keeps people from buying a manufactured home? Why aren’t they routinely addressing those prospective home buyers concerns?  Lightening rod Frank Rolfe, a well known MHI member, made the point simply.

 

Rolfe and Dave Reynolds effectively doubled down on that recently, when they said the following.

MHI has had two different public relations people, for a combined total of several years now. Do those ‘experts’ in media relations not have a message or method for advancing the acceptance of the industry? Do they not yet have a message that resonates with the millions in the public that would buy what our manufactured home industry offers, if they simply understood it properly?

When AZ Central reports that only 5 congressmen came to see what MHI dubbed “Homes on the Hill,” what was MHI’s public relations effort doing? 

The industry is only at ¼th of the production it was in 1998. Where is MHI’s recovery plan?

 

BloombergShipmentProductionDataManufacturedHousingMHProNews2019-05-16_1057

 

This pro-growth industry-leading trade media will continue to monitor and report on these and other related issues.

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That’s a wrap on this installment of News Through the Lens of Manufactured Homes, and Factory-Built Housing,” © where “We Provide, You Decide.” © ## (News, analysis, and commentary.)

 

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Related Reports:

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Positive, Uplifting Third-Party Reports Favor Modern Manufactured Housing, So What’s Going Wrong?

Bonuses, Bonuses! Manufactured Housing Struggles During Affordable Housing Crisis, While Top MHI Staffers Get Bonuses

Market Manipulation, What Does the Law Say?

January 31st, 2019 Comments off

 

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Manipulation is intentional conduct designed to deceive investors by controlling or artificially affecting the market for a security,” says the SEC website.

 

Market manipulation. Market manipulation is a type of market abuse where there is a deliberate attempt to interfere with the free and fair operation of the market and create artificial, false or misleading appearances with respect to the price of, or market for, a product, security, commodity or currency,” states Wikipedia, which cites their sources.

Manipulation is illegal in most cases, but it can be difficult for regulators and other authorities to detect. … It is much easier to manipulate the share price of smaller companies, such as penny stocks, because they are not as closely watched by analysts and other market participants as the medium and large cap firms,” said Investopedia on Nov 10, 2017.

Equity Master said, “Stock market operators are market participants who form a syndicate to manipulate stock prices for personal gain. … Through a coordinated act, the operators rig stock prices higher or lower, creating a frenzy or panic for a certain stock. Seeing the rapid stock price movements, traders flock in and perpetuate the trend.”

But there are other forms of market manipulation, that may or may not have anything to do with stocks and equities trading.

Consider the issue of boycotting. Here’s what the FTC says.

Group Boycotts

Any company may, on its own, refuse to do business with another firm, but an agreement among competitors not to do business with targeted individuals or businesses may be an illegal boycott, especially if the group of competitors working together has market power.”

Are there objective reasons to believe that such activity(ies) have been introduced in the manufactured housing industry?

There are published reasons – from third-parties to MHProNews – that suggest that a reasonable answer to that query is ‘yes.’

The FTC also successfully challenged the group boycott of an association…” in a case upheld by the U.S. Supreme Court, involving competing trial attorneys.

Boycotts to prevent a firm from entering a market or to disadvantage an existing competitor are also illegal,” says the FTC.

The arguably pro-MHI source publicly calling for a boycott itself claimed to include an MHI affiliate, for details and evidence, see the link here and see the related download, etc..  Is it poetic or jocular that this sort of persona would be selected by MHI to be their surrogate in a call for their ‘boycott?’

More recently, without a legal explanation, competing publishers were given preferential treatment at the Louisville Manufactured Housing Show, which included special treatment of the source that publicly called for an organized boycott.

The parties involved in that decision to play favorites at Louisville event have clear ties to MHI, as they include those that MHI themselves have termed their “affiliates” and/or are MHI members.

MHI leaders were advised of the matter.  At this point, the Daily Business News on MHProNews is not aware of any public action taken to stop the purportedly abusive practices.

These matters will take time to sort out.  As with other items, patience and persistence are required. But it is worth considering what MHI themselves have said in their antitrust guidelines.

 

ManufacturedHOusingInstiuteLogoAntiTrustInstructionsWarningManufacturedHousingIndustryMHProNews

 

That’s MH “Industry News, Tips, and Views Pros Can Use,” © where “We Provide, You Decide.” © ## (News, analysis, and commentary.)

 

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Cavco Industries New Board Member, Susan L. Blount – Corporate, Manufactured Home Industry Insights on Pick, Timing

January 29th, 2019 Comments off

CavcoIndustriesLogoCVCOlogoNewBoardMemberSusanLBlountPhotoManufacturedHomeIndustryInsightsPickTimingDailyBusinessNewsMHProNews

Cavco Industries (CVCO) has provided a recent release to the Daily Business News on MHProNews, regarding the announced selection of Susan L. Blount to the troubled firm’s Board Of Directors.

 

We’ve held that release for reasons that yesterday’s report on Cavco make clear. Before turning to portions of the Cavco release, industry sources tell MHProNews what this move represents.

Blunt on the Cavco Board of Directors is “…meant to inspire confidence both now and going forward…” for the Securities and Exchange Commission (SEC), plus the firm’s current and prospective shareholders.

Sources also say that this move to bring Blount on board is meant to blunt prospective plaintiffs attorneys too. Cavco, per sources, have engaged in several moves designed to prepare the firm for the legal battles that are expected.  For more on those legal issues, see the related reports, further below.

 

Here are some quotes from Cavco’s release to MHProNews, following the composite screen capture from LinkedIn.

 

SusanBlountCavcoIndustriesBoardOfDirectorsManufacturedHousingIndustryDailyBusinessNewsMHProNews

Cavco Industries Appoints Susan L. Blount to Board Of Directors

Former EVP and General Counsel of Prudential Financial Inc. will Bolster the Board’s Financial Services, Governance and Insurance Expertise

Cavco Industries, Inc. (NASDAQ: CVCO)…announced that its Board of Directors (“Board”) appointed Susan L. Blount as an independent director of the Company’s Board. Ms. Blount, an experienced financial services executive, retired as Executive Vice President and General Counsel of Prudential Financial, Inc. in 2015, having served as General Counsel since 2005.

Ms. Blount’s appointment fills the vacancy on Cavco’s Board and brings its current membership to five directors, all of whom are independent. She will be a member of the Company’s Corporate Governance and Nominating Committee and the Company’s Compensation Committee.

We are extremely pleased to welcome Susan Blount to our Board,” commented William Boor, non-executive Chairman of the Board of Cavco. “Susan’s accomplishments speak for themselves. She has significant and very relevant experience in strategy, corporate governance, risk and compliance in both the public and private sectors.”

Mr. Boor continued, “Susan’s addition reflects our commitment to enhance the Board’s capabilities and diversity. We look forward to getting the benefit of her insights, judgment and counsel, and we are confident that Susan will make a meaningful and very positive impact on our Company’s future success.”

I am excited to join and begin to work with the Cavco Board as we move into 2019,” said Ms. Blount. “Cavco fills an important role in the US housing market and the Company has impressed me with its strong commitment to governance and focus on superior stockholder returns.”

Ms. Blount is an outstanding addition to our Board,” added Daniel Urness, President and Acting Chief Executive Officer of Cavco. “Her public company and diverse corporate management experience will offer fresh perspectives and oversight to help our leadership team enhance long-term shareholder value.”

Susan L. Blount

From 2005 to 2015, Susan Blount served as General Counsel of Prudential Financial, Inc. (Prudential), a leading provider of insurance, retirement and asset management products and services. In that role, Ms. Blount led the company’s global law, compliance, business ethics and external affairs organization. During that time, Ms. Blount was a member of key senior management committees including the Office of the Chairman Group, the Enterprise Risk Committee and the Capital and Financial Controls Committee. Ms. Blount joined Prudential in 1985 as a staff attorney in the company’s commercial real estate organization. Before being appointed General Counsel, she held various positions of increasing responsibility, including Chief Investment Counsel, Vice President and Corporate Secretary, and Associate General Counsel and Head of Shareholder Service. Prior to joining Prudential, Ms. Blount was an Associate at Kirkland & Ellis.

In 2017, Ms. Blount was an Advanced Leadership Initiative Fellow at Harvard University. Since 2016, she has taught as an adjunct professor at the University of Texas School of Law. Ms. Blount is active in professional and community service. She currently serves on the University of Texas Law School Foundation, the Executive Committee of the Center for Women in Law and the Nantucket Historical Association. Ms. Blount has also served on the Boards of organizations such as Montclair State University, the Leadership Council for Legal Diversity, the Association of Corporate Counsel and the New Jersey Law and Education Empowerment Project. She has also been a faculty member at Stanford University’s annual Directors’ College and a participant in Stanford’s Institutional Investors Forum.

Ms. Blount graduated from The University of Texas at Austin with a bachelor’s degree in history and a juris doctor with honors.

About Cavco Industries, Inc.

Cavco Industries, Inc., headquartered in Phoenix, Arizona, designs and produces factory-built housing products primarily distributed through a network of independent and Company-owned retailers. The Company is one of the largest producers of manufactured homes in the United States, based on reported wholesale shipments, marketed under a variety of brand names including Cavco Homes, Fleetwood Homes, Palm Harbor Homes, Fairmont Homes, Friendship Homes, Chariot Eagle and Lexington Homes.

The Company is also a leading producer of park model RVs, vacation cabins, and systems-built commercial structures, as well as modular homes built primarily under the Nationwide Homes brand. Cavco’s mortgage subsidiary, CountryPlace Mortgage, is an approved Fannie Mae and Freddie Mac seller/servicer, a Ginnie Mae mortgage-backed securities issuer that offers conforming mortgages, non-conforming mortgages and home-only loans to purchasers of factory-built homes. Our insurance subsidiary, Standard Casualty, provides property and casualty insurance to owners of manufactured homes.

— end of quoted section of Cavco release —

CavcoIndustriesManufacturedHousingIndustry6MonthStockTrendCVCOMHProNews

JoeStegmayerCavcoCVCOMIChairBrianMontgomeryHUDFHASameLandyUMHPresidentDailyBusinessNewsMHPronews

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Related Reports:

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Cavco Industries (CVCO) Class Action Suit

Insider Trades, New Cavco Industries Investigation, Selling – Plus More Manufactured Housing Stock Updates

Hedge Fund’s Cavco Move, and More from Inside MHVille

 

Manufactured Home Production Decline Accelerates in November 2018

Manufactured Housing Institute on Cavco Industries, ex-Chairman Joe Stegmayer SEC “Debacle”

 

Wall Street, Lesli Gooch – Manufactured Housing Institute EVP – Penetrating Scotsman Guide Interview Analysis

January 26th, 2019 Comments off

 

WallStreetLesliGoochPhotoManufacturedHousingInstituteLogoPenetratingScotsmanGuideInterviewAanalysisDailyBusinessNewsMHProNews

Timely information combined with money can move stocks and markets. Information may be legally or illegally used, as the growing storm clouds over Cavco Industries (CVCO) concerning certain trades by Joe Stegmayer and Cavco reminded the manufactured home industry and its investors.  But note that Stegmayer and Cavco are not directly tied into today’s analysis, though they will be the focus of a looming report.

  

There was an interview reported this past week by the Scotsman Guide with the Manufactured Housing Institute (MHI) Executive Vice President (EVP) Lesli Gooch, Ph.D. That publication has quoted MHI previously.

Before examining Gooch’s comments and their timing, one should pause and do a brief refresher on the award-winning Oliver Stone movie, Wall Street.  Some selected quotes from Wikipedia will serve to tee up the ball, by conveying plot-lines that convey fictional but still useful concepts.  Each bullet is a quote from the link here.

     Bud Fox is a junior stockbroker at Jackson Steinem & Co. in New York City. He wants to work with his hero, Gordon Gekko, a legendary Wall Street player.

     Bud provides him [Gecko] some inside information about Bluestar Airlines, which he has learned in a casual conversation with his father, Carl, leader of the company’s maintenance workers union.

     …Gekko offers Bud another chance, and tells him to spy on British CEO Sir Lawrence Wildman and discern Wildman’s next move. Bud learns that Wildman is making a bid for a steel company. Through Bud’s spying, Gekko makes money, and Wildman is forced to buy Gekko’s shares to complete his takeover.

     …Bud is promoted as a result of the large commission fees he is bringing in and is given a corner office with a view. He continues to maximize inside information and use friends as straw buyers to provide more income for him and Gekko. Unknown to Bud, several of his trades attract the attention of the Securities and Exchange Commission.

     …Bud devises a plan to drive up Bluestar’s stock before manipulating it back down…” 

 

The MH Evening Market Report 

Every evening for several years, the Daily Business News on MHProNews does a closing market recap of specific manufactured housing industry connected stocks after the closing bell. What years of observations have yielded helped forge an evolving evening market report. Every business news show or website is premised in part on the notion that news stories, data, headlines, and insights often move one or more stocks, or even the broader markets.

For balance, MHProNews uses bullets from CNN Money and Fox Business, to allow for the media’s evident left-right divide. We use closing market data from CNN, Yahoo, and Bloomberg too.

 

CNNFoxNewsLeftRightMediaBiasDailyBusinessNewsMHproNEwsSharylAttkisson

MHProNews looks at issues from a wide variety of perspectives.

 

That a mere statement can move stocks and/or the broader markets is beyond question. For example:

Warren Buffett, Jeff Bezos, and Jaime Dimon made a public announcement in 2017 on the day of President of the United States (POTUS) Donald J. Trump’s State of the Union (SOTU) Address. Healthcare stocks, and much of rest of the markets dropped that day, as an apparent result.  Prior to that, stocks had enjoyed a long, steady rise.

Words and ideas apparently matter to Wall Street and investors. Who speaks those words matters too.

With that backdrop, let’s consider what “Dr. Gooch” from MHI said to the Scotsman Guide, as well as what occurred. There are no specific allegation being made. But the facts, quotes, narrative, and the outcomes after the shutdown will be considered. 

Let’s next look at some selected items from Scotsman Guide (SG) Media’s About Us page.

Scotsman Guide, the leading resource for mortgage originators, is published nationally every month in separate residential and commercial editions

 

Our History

Scotsman Guide Media is privately held company that has served the mortgage lending industry since 1985

Mission Statement

Scotsman Guide Media’s mission is to be the leading provider of information, resources and tools for professionals in the mortgage industry —in both the residential and commercial markets.

Toward this goal, Scotsman Guide Media has been taking the following steps

         Publishing educational articles and in-depth news-based features that keep mortgage professionals apprised of market trends and developments…”

The Daily Business News on MHProNews now turns to the actual SG article, starting with the date, time stamp, and featured image as shown.

 ScotsmanGuideLogoManufacturedHomeManufacturedHousingIndustryDailyBusinessNewsMHProNews1.26.2019

 

Top Headlines 

Jan 22, 2019  16:50 ET.

Shutdown threatens manufactured-home industry

The government shutdown hasn’t widely affected the manufactured-housing industry yet, but a prolonged closure has the potential to stop deliveries of new manufactured homes all over the country, an industry trade group says. 

The U.S. Department of Housing and Urban Development’s (HUD’s) Office of Manufactured Housing, an agency that oversees the building code and certification process for manufactured homes, has been closed during what has become the longest government shutdown in U.S. history. This has only so far affected manufacturers producing homes that require letters of approval for alternative construction, according to the Manufactured Housing Institute (MHI), an industry trade group.  

HUD often opts to approve alterations in approved floor designs or other features in manufactured homes on a case-by-case basis.  Because of the shutdown, HUD’s office can’t do that, leaving some manufacturers in limbo, said Lesli Gooch, MHI’s senior vice president for government affairs.

“If you don’t have approval through the alternative-construction process, that house can’t be delivered because that house can’t receive the HUD code-certification label,” Gooch told Scotsman Guide News. “We have a lot of manufacturers.”

Gooch said one plant in Mississippi, for example, was awaiting approval last week from HUD to install an HVAC unit that isn’t on its approved list. That company is producing manufactured-home units for the Federal Emergency Management Agency (FEMA).

“Because HUD is closed, they are not going to get approval, which means the production of these FEMA units is on hold until they get approval,” Gooch said. She said the trade group is still investigating how many deliveries have similarly been disrupted.

“I don’t have a sense of how large a problem this is as far as production being halted because of the need to renew an alternative-construction letter or the need to obtain an alternative-construction letter,” Gooch said. “The Mississippi issue is one that I was contacted about just because it is one federal agency requesting homes, and they can’t be built because HUD is closed,” she said.

Gooch also said there is the potential for widespread problems should the shutdown drag on for another month. MHI believes there is a possibility that the supply of HUD tags could run out because of the closure and budget impasse.  

Every manufactured home that is built and delivered in the U.S. — roughly 8,000 per month — has to be inspected and certified as having met safety standards. Once inspected, the manufacturer is given a red-metal tag, which is affixed to the exterior of the building to verify that it meets the standard. The home can’t be delivered to a customer until it is tagged.

“Based on our research, the industry’s PIAs [primary inspection agencies] should have enough labels on hand to get through the end of February,” Gooch said. “If the government shutdown continues, early March is our first estimate of when a problem could develop.” 

For the duration of the shutdown, HUD has also stopped the Title 1 loan program, which backs a small number of chattel loans each year used by borrowers to buy manufactured homes that aren’t titled as real property.  

 ## End of SG article being reviewed ##

The original article from the Scotsman Guide is linked here, and a download of the screen capture of that article’s page as of the date of this Daily Business News on MHProNews post is linked here.

Now, let’s turn to two graphics from our evening market reports.  The first is from the evening of 1.23.2019.  This would be the day after Gooch’s quoted commentary, shown above.

BloombergJan232019ClosingTickerManufacturedHousingIndustryTrackedStocksDailyBusinessNewsManufacturedHousingIndustryMHProNews

Berkshire and MMI clearly have other interests, beyond manufactured homes, as is true of some of the other tracked stocks shown above. But Cavco is a factory-built housing focused firm. The majority of the tracked stocks fell on the day following Gooch’s comments.

 

The next graphic is from the evening of 1.25.2019, after the end of the partial federal shutdown was announced.

BloombergJan252019ClosingTickerManufacturedHousingIndustryTrackedStocksDailyBusinessNewsManufacturedHousingIndustryMHProNews

Virtually all tracked stocks moved up by the close of the market’s day following the partial federal shutdown. Next, look at what the broader markets did on 1.23.2019 and on 1.25.2019.

 

Note that there was already Washington, D.C. and media scuttlebutt that a deal to end the recent shutdown was already in motion at the time the Scotsman Guide article was published.  Note too what the broader markets did on both days, which largely closed up.

 

YahooFinance12ClosingIndictatorTickerSummaries1-23-2019ManufacturedHousingIndustryDailyBusinessNewsMHProNews

These 12 indicators are published every evening on the Daily Business News on MHProNews market summary and related featured report. Note that the markets generally rose both days, but on the 1.23.2019, the manufactured housing industry’s connected tracked stocks largely fell. It could be a coincidence. But what if Gooch’s article – intentionally or not – was used by traders and investors to reconsider some of their positions in manufactured home businesses?

YahooFinance12ClosingIndictatorTickerSummaries1-25-2019ManufacturedHousingIndustryDailyBusinessNewsMHProNews

Then consider this point.  There are arguably few manufactured home industry professionals, much less stock market watchers and investors, who would have even considered the notion that a partial federal shutdown could impact manufactured housing at all.

So why make did Gooch make those comments in the first place?

As was noted at the top of this column, Joe Stegmayer is under the cloud of an SEC subpoena. He stepped down as Chairman and CEO of Cavco, and the stock plunged as a result. A follow up report on that topic is pending, as there are new developments learned about that fiasco, which will be reviewed in the days ahead by MHProNews. 

But for now, we will simply note the obvious. Stegmayer is still MHI’s Chairman. He is an ex-division president of Clayton Homes, a Berkshire Hathaway company. Since the time that Triad Financial Services CEO Don Glisson, Jr was briefly their chairman, MHI apparently has had no problem with keeping someone on as chair that has come under a cloud of legal or media suspicion. Consider these three. 

   Better Business Bureau (BBB) “F rated” SSK Communities’ partner Nathan Smith

   Tim Williams, President and CEO or Berkshire Hathaway owned 21st Mortgage Corp, and

   Joe Stegmayer of Cavco Industries (CVCO) have all come under a cloud of legal, media, regulatory, and/or some other combination of suspicion. 

None of those 3 bothered to step down as MHI Chairman.   Although MHI has postured efforts for growth for years, the industry has steadily been consolidating. Sales have been moribund, in spite of overall quality and satisfaction that third party research has documented. One such example of their party praise is linked here.

 

Questions, Questions…

There ought to be some open questions from investigators that seek honest answers as to why Gooch would make these statements in the first place.

  • Who did or might have benefited from Gooch’s odd statements?
  • Who did this potentially impact – or which firms might have been harmed – by Gooch’s statements?
  • Were her arguably misguided comments merely foolish? Or where they a page out of the MHI play book – namely, actions and/or inactions that harm independents – that also fits loosely with a plot-line of the movie Wall Street?

What is certain is that Congressional hearings and an SEC investigation ought to be conducted related to several issues connected to the Manufactured Housing Institute. But it won’t be only about the article reviewed above. It should also be about the facts and evidence from articles linked below the bylines and the notices that follow.

We opened this with the words, “Timely information combined with money can move markets. Information may be legally or illegally used…”  There’s an affordable housing crisis.  Yet, manufactured housing is snoring instead of roaring.  MHI claims to be promoting the industry.  How did Gooch’s comments promote confidence?

 

ManufacturedHousingSHipmentsBloombergQuintFactoryBuiltRebuidRecoveryDailyBusinessNEwsMHproNEws

See MHI President Richard ‘Dick’ Jennison’s comments, linked below the byline. Also see what MHI’s prior president said at this link here.

 

Corruption, waste, fraud, and other abuses in the Washington, D.C. metro are not new.  But that doesn’t mean that they should be tolerated.

Something has smelled in certain offices in Arlington, VA for some time. And it’s not a flowery aroma.  Rather, it’s arguably the stench of a string of troubling incidents and concerns connected to MHI that has made them worthy of suspicion, which our coverage and analysis of such #nettlesome things have made this pro-manufactured housing growth publication the most widely read trade media in this industry today. 

That’s MH “Industry News, Tips, and Views Pros Can Use” © where “We Provide, You Decide.” ## © (News, analysis, and commentary.)

 

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To report a news tip, click the image above or send an email to iReportMHNewsTips@mhmsm.com – To help us spot your message in our volume of email, please put the words NEWS TIP in the subject line.

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SoheylaKovachDailyBusinessNewsMHProNewsMHLivingNewsSubmitted by Soheyla Kovach to the Daily Business News for MHProNews.com. Soheyla is a managing member of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com.

 

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MHI CEO Dick Jennison’s Pledge – 500,000 New Manufactured Home Shipments

Bridging Gap$, Affordable Housing Solution Yields Higher Pay, More Wealth, But Corrupt, Rigged Billionaire’s Moat is Barrier

Midwest Manufactured Housing Federation Official Louisville Show Communique to MHProNews

 

“The Illusion of Motion Versus Real-World Challenges”

Production Decline Continues in November 2018

 

 

 

 

 

 

 

 

Cavco Shareholder Suits Prepping, CVCO, SEC, Insider Responses to Growing Scandal

November 15th, 2018 Comments off

 

CavcoShareholderSuitsPreppingCVCOSECInsiderResponsesGrowingScandalHolzerHolzerLawLogoKaseklaLawLogoCavcoLogo

Cavco and the Securities and Exchange Commission (SEC) have both responded to inquiries from the Daily Business News on MHProNews. Before turning to their comments, the larger news item is the start of the headline above. At least two law firms are calling on Cavco Industries (CVCO) shareholders to contact them, as they advance investigations that aim to sue-for-damages for wrongdoings by the publicly trade manufactured and modular home company.

 

The “Debacle” at Cavco

As a follow up to last night’s report, linked below, an insider with Cavco has called the developments at the Phoenix, AZ based firm a “debacle.”

Other sources at Cavco with knowledge have declined specific comments, perhaps knowing that the matter has already harmed the value of any shares that they personally hold.

 

Manufactured Housing Institute on Cavco Industries, ex-Chairman Joe Stegmayer SEC “Debacle”

 

Our report last night report last night included the following:

 

CVCOJoeStegmayerStockDropAfterSECCOnnectedShakeupManufacturedHousingIndustryDailyBusinessNewsMHproNews

 

Shareholder Alert” from 2 Law Firms

Their news release opened with, “SHAREHOLDER ALERT: Investigation of Cavco Announced by Holzer & Holzer, LLC

HolzerHolzerGoogleSummaryClassActionAttorneyDailyBusinessNewsMHProNews

It continued as follows:

Holzer & Holzer, LLC is investigating whether certain statements made by Cavco Industries, Inc. (“Cavco” or the “Company”) (NASDAQ: CVCO) complied with federal securities laws. On November 8, 2018, Cavco announced that an internal investigation had identified certain violations of the Company’s policy related to securities trading activities by former CEO, Joseph Stegmayer. The price of Cavco common stock fell significantly following this announcement.

If you purchased Cavco common stock and suffered a loss on that investment, you are encouraged to contact Corey D. Holzer, Esq. at cholzer@holzerlaw.com or Marshall P. Dees, Esq. at mdees@holzerlaw.com, or by toll-free telephone at (888) 508-6832 to discuss your legal rights.”

 

HolzerHolzerAttorneyForInvestorsDailyBusinessNewsMHproNews

 

Another media release from a different law firm provided to MHProNews said the following.

 

KasekalaLawLLCLogoManufacturedHousingIndustryDaiyBusinessNewsMHProNews

All images and content are provided under fair use news media guidelines.

SHAREHOLDER ALERT: Kaskela Law LLC Announces Investigation of Cavco Industries, Inc. and Encourages Investors with Losses in Excess of $100,000 to Contact the Firm – CVCO

What follows is the body of their media statement.

Nov 14, 2018

Legal Newswire POWERED BY LAW.COM

RADNOR, Pa.,  — Kaskela Law LLC is investigating Cavco Industries, Inc. (NASDAQ: CVCO) (“Cavco” or the “Company”) on behalf of investors.  The investigation seeks to determine whether Cavco and certain of its officers and/or directors made false and/or misleading statements to investors, and whether Cavco investors have been harmed as a result.

Cavco investors with financial losses in excess of $100,000 are encouraged to contact Kaskela Law LLC (D. Seamus Kaskela, Esq.) at (888) 715 – 1740, or via email at skaskela@kaskelalaw.com, to discuss this investigation and their legal rights and options.  Additional information about this investigation may also be found at http://kaskelalaw.com/case/cavco-industries-inc/

On November 8, 2018, Cavco disclosed that “on August 20, 2018, the Company received a subpoena from the SEC’s Division of Enforcement requesting certain documents relating to, among other items, trading in the stock of [a] Public Company.  On October 1, 2018, the SEC sent a subpoena for documents and testimony to former Chairman, President and Chief Executive Officer, Joseph Stegmayer regarding similar issues.  At this time, the Company believes that Mr. Stegmayer traded in certain publicly traded stock in his personal accounts as well as in accounts held by Cavco at a time when the Company had agreed to refrain from such trading. The Company intends to cooperate fully with the SEC’ s investigation.  Effective November 8, 2018, Mr. Stegmayer stepped down as Chairman, President and Chief Executive Officer of the Company after an internal investigation, conducted by independent legal counsel to the Audit Committee of the Board of Directors, identified certain violations of Company policy related to securities trading activities conducted by Mr. Stegmayer. The internal investigation remains ongoing.”  

Following this news, shares of the Company’s common stock declined $49.48 per share, or over 23%, to close on November 9, 2018 at $165.20 per share, on heavy trading volume. 

Cavco investors with financial losses in excess of $100,000, and individuals with information relevant to this investigation, are encouraged to contact Kaskela Law LLC at (888) 715 – 1740 or via http://kaskelalaw.com/case/cavco-industries-inc/ Kaskela Law LLC exclusively represents investors in state and federal actions throughout the country.  For additional information about Kaskela Law LLC please visit www.kaskelalaw.com.  This notice may constitute attorney advertising in certain jurisdictions.

URL : http://www.kaskelalaw.com

Contact Information:

Kaskela Law LLC

Seamus Kaskela, Esq.

201 King of Prussia Road

Suite 650

Radnor, PA 19087

(484) 258 – 1585

(888) 715 – 1740

skaskela@kaskelalaw.com

www.kaskelalaw.com

The Kaskela website says the following about the firm’s specialty and services.

Kaskela Law represents current and former shareholders of publicly traded corporations in securities fraud class actions, shareholder derivative actions, and merger & acquisition litigation. The firm exclusively litigates cases on behalf of investors on a contingency basis – advancing all costs and fees until the successful completion of a case.”

 

Cavco, SEC Responses to MHProNews Inquiries

Joe_Stegmayer_Cavco_credit_MHProNews

Joe Stegmayer.

What follows are the replies from media spokesmen for Cavco and the SEC.

They could be summed up as ‘polite, artful dodges,’ but we asked for an attorney to review those replies, which will follow further below, as they are insightful.

That outside attorney’s off-the-record responses are likely to be of wide interest to manufactured housing industry professionals, as well as to Cavco shareholders. As a disclosure, it should be noted that the principles of MHProNews hold no positions in that company.

Note that John Lovallo was the Cavco designated contact for this matter involving ex-chairman, Joe Stegmayer.

Lovallo was asked about the threat of litigation being raised by the law firms above. As of this time, no reply has come to that inquiry.

However, Lovallo did reply to prior inquiries by MHProNews, as follows.

First, the only public statement relating to the findings of the independent investigation and SEC subpoenas is included in the Company’s SEC filings and public disclosures.

The only additional public/on the record statement I can provide on the SEC matter is as follows:

“The Company is fully cooperating with the SEC’s investigation 

Related to your other comments our additional public/on the record statement is as follows:

“It is business as usual at the Company. Cavco continues to build quality, energy efficient homes for the modern-day home buyer, and team members are focused on providing customers and partners best in class service. 

Cavco is a strong Company and is strategically positioned to continue to be an industry leader under Dan Urness’s leadership. And, as reported last week, the Company’s fiscal second quarter 2019 financial results were strong. 

Mr. Urness and his team are focused on continuing to execute. The Board of Directors fully supports Cavco’s current strategy and is confident that Dan Urness is the right person to build on the Company’s success.” 

You can attribute the above statements to John Lovallo spokesperson for Cavco Industries.”

 

A follow up questions that asked which stock(s) were involved brought a polite, prompt reference back to the previous statement.

Per Lavollo, “Here is the link to our public filing (10Q), which covers our public disclosure on the SEC matter – https://investor.cavco.com/public/phhweb/gallery/userupload/ir-doc-580/cvco_2018.9.29_10q_final.pdf 

Please see page 25, paragraph 4, where it states: 

“Legal Matters. On August 20, 2018, the Company received a subpoena from the SEC’s Division of Enforcement requesting certain documents relating to, among other items, trading in the stock of another public company. On October 1, 2018, the SEC sent a subpoena for documents and testimony to Joseph Stegmayer, the Company’s former Chairman, President and Chief Executive Officer, regarding similar issues. At this time, the Company believes that Mr. Stegmayer traded in certain publicly traded stock in his personal accounts as well as in accounts held by the Company at a time when the Company had agreed to refrain from such trading. The Company has initiated an independent investigation and intends to cooperate fully with the SEC’s investigation.” 

This is our public disclosure related to the SEC matter.

John

John Lovallo

Practice Chair – Financial Communications

 

JohnLovalloPhotoLevickLogoCommunicatingTrustCAVCOIndustriesCVCODailyBusinessNewsMHProNews600

 

About Lovallo, Levick and Cavco

Cavco Industries has their own media relations person. That normal press relations person at Cavco was also contacted, but allowed John Lovallo to make all of their formal replies in this Stegmayer/SEC matter.

Why is that significant?

Because Lovallo works for Levick, which their site describes as follows.

We are the leading public relations firm that establishes and protects trust. LEVICK deploys uniquely qualified teams – armed with the instincts, influence, and experience needed to win your battles in an increasingly complex and challenging world.

As the screen capture below reflects, Levick is into “crisis management.”

 

LevickCommunicatingTrustCrisisManagementDailyBusinessNewsMHProNews

 

Put differently, it’s arguably recognition by management at Cavco that they have a crisis, which they are trying to manage as best they can. That’s not implying something sinister. Rather, it’s perhaps an intelligent option to attempt to protect a firm and its shareholders.

But that in turn arguably underscores what our well-placed source told MHProNews, namely, that this is a “debacle” at Cavco.

Given Joe Stegmayer’s role as MHI Chairman, it’s a “debacle” that arguably reflects beyond Cavco.

Which brings us to the SEC.

Christopher Carofine, at the U.S. Securities and Exchange Commission, told MHProNews that the organization “Decline to comment.”  That was in response to this inquiry.

Cavco’s press release

 

https://globenewswire.com/news-release/2018/11/08/1648646/0/en/Cavco-Industries-Annouces-Executive-Leadership-Changes.html

says in part as follows:

The Company also announced that it had received a subpoena from the Securities and Exchange Commission’s Division of Enforcement (“SEC”) requesting certain documents relating to, among other items, trading of the stock of another public company. Subsequent to sending the Company a subpoena, the SEC sent a subpoena for documents and testimony to Joseph Stegmayer, regarding similar issues. The Company has initiated an independent investigation and intends to cooperate fully with the SEC’s investigation. Please see Part II, Item 1, Legal Proceedings section of the Company’s quarterly report on Form 10-Q for the period ended September 29, 2018, filed with the Securities and Exchange Commission contemporaneously with the issuance of this press release, for additional information regarding this matter.”

Our question is this.  Which company was the “trading of the stock of another public company” referring to, please?”

But the next direct ‘no comment’ could, depending on the answer to the issues raised herein, be a hidden story-behind-the-Cavco-trading-story.

MHProNews asked the SEC’s Carofine, “Are you investigating possibly AntiTrust issues? Involving Clayton Homes (Berkshire Hathaway), Cavco and Stegmayer, who is still the Manufactured Housing Institute chair?”

Carofine’s reply?

Decline to comment.”

 

Outside Counsel OTR Feedback to Above

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According to an outside attorney asked to review the puzzle pieces laid out above, “the key language to me — and potentially the key to solving the mystery — is the language “at a time when the company had agreed to refrain from such trading.”  That would indicate that there was some previous issue with the SEC or other regulators — i.e., “agreed” with who?  And why?  Would the trading have been legal but for that agreement?  Did the agreement grow out of a previous enforcement action? When?  Probably the agreement was in writing.  Where is it?  Wouldn’t such an agreement be germane to investors?  Was it disclosed?  When?  If not, why not?

 

Another legal comment indicated that this may or may not connect to concerns by some in the industry that a masked antitrust issue may be at play.

It’s a concern that is denied by those asked at Cavco.

But Stegmayer, who is a former division president for Clayton Homes, per some industry sources, needed help to get his early acquisitions of other manufactured home firms at Cavco ‘done.’  “Their [Cavco’s] balance sheet didn’t support” their early acquisition, was an argument made by one such source, when MHProNews asked for evidence of their concern.

CavcoIndustriesCVCOFocusTransformationManufacturedHousingIndustryDailyBusinessNewsMHProNews

From Cavco IR presentation.

It should be noted that prior to receiving documents on 21st used in Smoking Gun 3 (see related reports, further below) and other MHProNews articles, those was just another unconfirmed claim. Obviously, those documents transformed a mere claim into a noteworthy purported path to consolidate manufactured housing.  So, if there is specific evidence about Cavco and their acquisitions, it should be presented to investigators or MHProNews, which can be done off-the-record.

An attorney indicated that the pending CVCO shareholder suits, if they aren’t settled out of court, could reveal information on that antitrust, MHI, Clayton, or other subjects in discovery.  Because these have possible antitrust and/or RICO implications, and could be a thorny issue for the Manufactured Housing Institute (MHI) too.

MHProNews will continue to monitor this issue and expects relevant updates from contacts with the various operations noted above. That’s this morning’s MH “Industry News, Tips, and Views Pros Can Use,” where “We Provide, You Decide.” © ## (News, analysis, and commentary.)

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Related Reports:

Greener, Stylish Manufactured Homes – Hidden Facts in the Washington Post Manufactured Housing Narrative

 

Smoking Gun 3 – Warren Buffett, Kevin Clayton, Clayton Homes, 21st Mortgage Corp Tim Williams – Manufactured Home Lending, Sales Grab?

 

 

Manufactured Housing Institute on Cavco Industries, ex-Chairman Joe Stegmayer SEC “Debacle”

November 14th, 2018 Comments off

 

JoeStegmayerPhotoManufacturedHousingInstituteLogoMHILogoChairmanCavcoIndustriesLogoManufcturedHomesMHProNews600x315

The Manufactured Housing Institute (MHI) has sent out a message to their members earlier today.  It’s debatably a common-for-the-Arlington, VA based trade group, in that it has a mix of purportedly accurate, questionable, misleading, and missing information.

 

Among the more interesting points are what MHI was mute on.

For example, what is to become of Joseph Stegmayer, who is still listed on the MHI website as their current executive committee chairman?

 

Cavco Chairman Joseph H. Stegmayer Steps Down Under SEC Cloud, “Personal, Confidential” SEC Document, Cavco Industries’ Statement

 

Stegmayer stepped down last week under the cloud of an Securities and Exchange (SEC) subpoena, as the Daily Business News on MHProNews reported at this link above.

Quoting part of Cavco’s statement: “The Company also announced that it had received a subpoena from the Securities and Exchange Commission’s Division of Enforcement (“SEC”) requesting certain documents relating to, among other items, trading of the stock of another public company. Subsequent to sending the Company a subpoena, the SEC sent a subpoena for documents and testimony to Joseph Stegmayer, regarding similar issues. The Company has initiated an independent investigation and intends to cooperate fully with the SEC’s investigation. Please see Part II, Item 1, Legal Proceedings section of the Company’s quarterly report on Form 10-Q for the period ended September 29, 2018, filed with the Securities and Exchange Commission contemporaneously with the issuance of this press release, for additional information regarding this matter.”

Sources suggest to MHProNews that if Stegmayer is cleared, he might return to a leadership role at Cavco. But if the SEC investigation proves to be as serious as some inside and outside of the publicly trade firm (CVCO) believe, Stegmayer could be exited from his new interim role.  The full Cavco release is found at this link here.

 

“Debacle”

An insider, well-placed source told MHProNews that the development at Cavco was a “debacle.” There will be a separate follow-up report that focuses on updates from Cavco and other sources on the Stegmayer matter.

But why is Stegmayer still in his position as MHI Chairman, while the fog of an SEC investigation hangs over Cavco?

 

CVCOJoeStegmayerStockDropAfterSECCOnnectedShakeupManufacturedHousingIndustryDailyBusinessNewsMHproNews

 

Scandal and Some MHI Chairmen…

Recall that MHI didn’t budge when then-Chairman Nathan Smith came under his own cloud when residents of SSK filed a class action suit against his firm.

Other controversies during the Tim Williams/21st Mortgage prior chairman era failed to move the Arlington, VA based association then.  That included, but isn’t limited to, allegations of racism and predatory lending against Berkshire brands.  Congresswoman Maxine Waters is now slated to take over as the chair for the House Financial Services Committee.  Waters and her colleagues asked for the Department of Justice (DOJ) to investigate.

 

Seattle Times -Federal Investigations-Berkshire Hathaway’s Clayton Homes, GuruFocus Spotlights Buffett’s Clayton’s “Unethical,” Monopolistic Moat

 

According to the Seattle Times, those investigations are ongoing. MHProNews recently reported that other federal investigations of MHI member ‘big boys’ are also under investigation.

 

Affordable Housing, the Visible, Yet Mysterious Struggle for an Obvious Solution, Case Examples

 

One or more investigation storm(s) of the manufactured housing industry’s larger members, potentially including MHI itself, are purportedly approaching.  And should that tempest become public in an oversight way, it may come from Democratic sources, given statements by Waters and others.

Yet for whatever reasons, Tim Williams, Jim Clayton, Warren Buffett and others supported opposition candidates that previously worked for MHI on Preserving Access.  Or is that part of the point?

Recall that Nathan Smith admitted that the industry (i.e.: MHI) had to honestly admit the times it dropped the ball.

 

 

That said, where are any of the issues raised herein addressed in MHI’s recent email news today? Where is the transparency that the late Howard Walker – who was on the MHI Executive Committee for years – said should exist?

 

HowardWalkerPhotoELSViceChairmanManufacturedHomeCOmmunitiesManufacturedHousingInstituteExecCommitteeMemberQuoteTransparencyMHProNews

Thoughtful words, worth pondering. 

 

ManufacturedHousingInstituteLogoMHILogoNewsUPdatesMHProNews11.14.2018DailyBusinessNewsMHProNews

 

Note there are other debatably deceptive, misleading or a mix of truth-with-slight-of-hands in the recent MHI communication to their members.  Some of those may be explored further in the days ahead.

In the meantime, a simple word to the wise.  If MHI said it, how does it stack up to objective facts?

NOTICE: Watch for a follow up report on the Cavco/Stegmayer/SEC matter in the days ahead. To sign up for our emailed headline news, see the link here or below.

The Daily Business News on MHProNews will continue to track and report on these issues. “We Provide, You Decide.” © ## (News, analysis, and commentary.)

(Related Reports are further below. Third-party images and content are provided under fair use guidelines.)

1) To sign up in seconds for our MH Industry leading emailed news updates, click here.

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2) To pro-vide a News Tips and/or Commentary, click the link to the left. Please note if comments are on-or-off the record, thank you.

3) Marketing, Web, Video, Consulting, Recruiting and Training Re-sources

SoheylaKovachDailyBusinessNewsMHProNewsMHLivingNewsSubmitted by Soheyla Kovach to the Daily Business News for MHProNews.com. Soheyla is a managing member of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com.

 

 

 

Related Reports:

Cavco Shareholder Suits Prepping, CVCO, SEC, Insider Responses to Growing Scandal

 

National New HUD Code Manufactured Home Production Data Summary, September 2018 Analysis

 

“Rent is Too Damn High,” But Why? MHVille Struggles & Solutions

Prosperity Now, Protests, Indivisible Project, Warren Buffett, George Soros, POTUS Donald Trump, MHAction and Manufactured Housing – Following the Money

 

Affordable Housing, the Visible, Yet Mysterious Struggle for an Obvious Solution, Case Examples

 

 

 

Analyst, Investor Action at Skyline – What’s Happening?

May 5th, 2017 Comments off
AnalystInvestorActionatSkylineWhatsHappeningcreditBloomberg-creditdailybusinessnewsmhpronewsmhlivingnews

Credits: Skyline, Pinterest.

For Skyline Homes, a recent rough patch has analysts and investors making moves.

According to the Cerbat Gem, TheStreet downgraded shares of the company from a “c” rating to a “d” rating, in a research note issued to investors late last week.

The move comes as Skyline’s stock price has declined over 26 percent since September 2016, which the Daily Business News has followed closely in the daily market wrap.

Also of note is the announcement regarding the shutdown of their Mansfield, Texas production facility, and the subsequent announcement that Champion Homes will acquire it.

Skyline followed up that announcement on March 9th, saying that it had suspended operations at its Elkhart, Indiana plant.

It’s not that we didn’t have the orders or the business or the customer base,” said Skyline president and CEO Richard Florea. “Despite demand from manufactured housing dealerships and manufactured housing communities, the leased facility used for production prevented daily volumes to reach and maintain profitable efficiencies.

Skyline has taken steps to ensure the 90 or so employees affected by the move are not without work, offering them jobs at other Skyline facilities in Wisconsin or Ohio or connecting them with other job opportunities.”

The SEC filing from Skyline said that the company was unable to profitably operate the 50,000 square-foot facility, which it began leasing from Forest River last year.

Investor Activity 

These developments have investors making moves, with Renaissance Technologies LLC raising its position in Skyline by 51.6 percent in the fourth quarter, now with a value of just over $5 million.

Wells Fargo & Company increased its position in Skyline by 2.5 percent in the first quarter, and now owns nearly 1.2 million shares valued at $11,233,000.

AnalystInvestorActionatSkylineWhatsHappeningcreditBloomberg-creditdailybusinessnewsmhpronewsmhlivingnews

Skyline 1 year look. Credit: Bloomberg.

As Daily Business News readers are already aware, Skyline is also one of the industry stocks monitored each business day. For the most recent closing numbers on all MH industry-connected tracked stocks, please click here. ##

 

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rcwilliams-writer75x75manufacturedhousingindustrymhpronews

RC Williams, MHProNews.

Submitted by RC Williams to the Daily Business News for MHProNews.

What’s Happening With Skyline Corp?

March 9th, 2017 Comments off
WhatsHappeningWithSkylineCorpcreditInsideIndianaBusiness-postedtothedailybusinessnewsmhpronewsmhlivingnews

Skyline HQ. Credit: Inside Indiana Business.

Fresh off of their announcement regarding the shutdown of their Mansfield, Texas production facility, and the subsequent announcement that Champion Homes will acquire it, Skyline Corp. (NYSE: SKY) announced yesterday that the company has suspended operations at its Elkhart, Indiana plant.

 

According to the South Bend Tribune, Skyline also announced that they have laid off the majority of the workforce at the facility.

It’s not that we didn’t have the orders or the business or the customer base. It’s that in a leased facility, it did not allow us to produce a high enough volume to achieve operational efficiency,said Skyline president and CEO Richard Florea.

Skyline has taken steps to ensure the 90 or so employees affected by the move are not without work, offering them jobs at other Skyline facilities in Wisconsin or Ohio or connecting them with other job opportunities.

richard-w-flora-credit-linkedin-skyline-corp-new-president-posted-daily-business-news-mhpronews-com-1

Credit: LinkedIn.

Florea also said that other measures have been taken to minimize the impact.

We allowed some other companies in town to come in and take applications from employees. We made it as easy as possible so people don’t have to go out and look for jobs,” said Florea.

The SEC filing from Skyline said that the company was unable to profitably operate the 50,000 square-foot facility, which it began leasing from Forest River last year.

Despite demand from manufactured housing dealerships and manufactured housing communities, the leased facility used for production prevented daily volumes to reach and maintain profitable efficiencies,” the company said in the filing.

The corporation anticipates having sufficient orders to maintain production at the Elkhart facility until March 8, 2017. The majority of the workforce is expected to be terminated shortly after production ceases.

SkylineCorpModularHome-postedDailyBusinessNews-MHProNews

Skyline modular home, credit Skyline.

Once a pioneer in the manufactured housing industry, nine consecutive years of significant losses have contributed to Skyline’s struggle to regain profitability. It posted a $1.7 million profit in 2016.

As MHProNews reported in September, 2014, Skyline spun off its recreational vehicle division to Evergreen Recreational Vehicles. For that story, click here.

Even with the tough news, Florea did see a glimmer of hope.

Skyline could re-establish production in Elkhart if we find the right facility and the labor market improves,” said Florea.

The area is currently suffering from a labor shortage, due to a jobs boom in the manufactured housing and RV industries.

As Daily Business News readers are already aware, Skyline is also one of the industry stocks monitored each business day. For the most recent closing numbers on all MH industry-connected tracked stocks, please click here. ##

 

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rcwilliams-writer75x75manufacturedhousingindustrymhpronews

RC Williams, for Daily Business News, MHProNews.

Submitted by RC Williams to the Daily Business News for MHProNews.

Inside Recent Moves at Universal Forest Products Inc.

December 23rd, 2016 Comments off
universalforestproductsufpi-bizcard-postedmanufacturedhousingindustrydailybusinessnews-mhpronews

Business card made of wood. Image credit, UFPI.

Universal Forest Products Inc. (NASDAQ:UFPI) has seen investors make moves in the company, led by Shinko Asset Management Co. Ltd. reducing its stake in the company by 30.6 percent during the third quarter, according to its most recent disclosure with the Securities and Exchange Commission (SEC).

A number of other institutional investors have also modified their holdings:

  • Fuller & Thaler Asset Management Inc. acquired a new position in the company during the second quarter worth $130,000.
  • BlackRock Japan Co. Ltd increased its stake by 59.5 percent in the second quarter.
  • HSBC Holdings PLC acquired a new position in the company in the second quarter worth $205,000.
  • PineBridge Investments L.P. increased its stake by 4.6 percent in the second quarter.

Credit: Cerbat Gem.

The Daily Business News recently covered UFPI’s Q3 earnings call, where the company reported $1.36 earnings per share (EPS) for the quarter, beating analysts’ estimates of $1.35.

universalforestproductsannouncesearningsresultscreditufpi-postedtothedailybusinessnewsmhpronewsmhlivingnews

Matthew Missad. Credit: UFPI.

The employees of Universal are working hard to top the records they achieved during the last half of 2015, and we are pleased once again to report record results and growth,” said CEO Matthew J. Missad.

We grew sales significantly in two key markets and continue to increase our sales of new products.

According to the Cerbat Gem, UFPI also announced a semi-annual dividend, which was paid on Thursday, December 15th. Investors of record on Thursday, December 1st were given a dividend of $0.45 per share. The ex-dividend date was Tuesday, November 29th.

Company insiders were also active, with UFPI Vice President Patrick M. Benton sold 1,368 shares of the firm’s stock in a transaction dated Monday, November 28th at an average price of $102.56, for a total value of $140,302.08.

Vice President Michael F. Mordell sold 1,700 shares of the firm’s stock in a transaction dated Tuesday, December 13th at an average price of $107.32, for a total value of $182,444.00.

UFPI is one of the various industry-connected stocks monitored each business day on the industry’s only daily market report, featured exclusively on the Daily Business News.  For today’s closing numbers on all MH industry-connected tracked stocks, please click here. ##

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RC Williams, for Daily Business News, MHProNews.

Submitted by RC Williams to the Daily Business News for MHProNews.