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MDC Gears Up to Report Q4 Earnings: Here's What to Know
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M.D.C. Holdings, Inc. is scheduled to report fourth-quarter 2023 results on Jan 30, 2024, before market open.
In the last reported quarter, the company’s earnings topped the Zacks Consensus Estimate by 18.6% but declined 29.3% year over year. Total revenues missed the Zacks Consensus Estimate by 1% and fell 22.9% from the year-ago quarter’s levels.
MDC’s earnings beat the consensus mark in three of the trailing four quarters and missed the same for once, the average surprise being 53.6%.
The Trend in Estimate Revision
The Zacks Consensus Estimate for the to-be-reported quarter’s earnings per share remained unchanged at $1.44 in the past seven days. However, the estimated figure indicates a 33.3% rise from the year-ago quarter’s earnings of $1.08 per share.
The consensus mark for revenues is pegged at $1.29 billion, suggesting a decline of 14.9% from the prior-year quarter’s reported figure.
Factors to Note
Revenues
MDC's fourth-quarter revenues are expected to have declined year over year due to the moderation in the housing demand. The downside is likely to be caused by higher mortgage rates and lower average selling prices. Also, the company has been facing challenges from the material cost and wage inflation, impacting the overall affordability of the U.S. housing market.
The company has been focusing on strategic investments in homebuilding operations to expand its local market presence. Land acquisition activity experienced a significant uptick in the third quarter and this trend was anticipated to persist in the fourth quarter.
Also, MDC's financing incentives, like rate buy-downs and closing cost assistance, effectively address buyer affordability concerns. These strategic initiatives are likely to have helped it partially offset the adverse effects of the aforementioned risks.
For fourth-quarter 2023, MDC expects home deliveries to be within 2,200-2,400 units, down from 2,554 units delivered a year ago. Our model predicts deliveries to decline 10.8% year over year to 2,277 units.
MDC expects the average selling price or ASP for the quarter to be in the range of $545,000-$555,000 compared with $582,300 reported a year ago. Our model predicts ASP to decline 5% year over year to $553,200.
Segment-wise, we expect the Homebuilding revenues to decline 15.3% to $1.26 billion from $1.49 billion reported a year ago due to lower deliveries and ASP. Also, we anticipate the Financial Services revenues to drop 0.9% year over year to $32 million.
Margins
The bottom line of MDC is likely to be affected by the ongoing inflationary pressures, higher costs and softer revenues. The company anticipates the housing gross margin (assuming no impairments or warranty adjustments) to be between 18% and 19.5% compared with 21.3% reported in the prior year.
Our model predicts homebuilding gross margin (excluding inventory impairments) to be 18% for the quarter, down from the year-ago period’s levels.
Orders & Backlog
We expect new orders of MDC to increase 998.1% year over year to 2,086 units in the quarter. Our model predicts the ASP of new orders to increase 39.6% year over year to $547,100.
We anticipate the total backlog to decline 13.1% to 2,584 units from 2,974 units reported a year ago. We expect the ASP of the total backlog to drop 1.1% year over year to $596,000.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for MDC for the quarter to be reported. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. Unfortunately, that is not the case here, as you will see below.
Earnings ESP: MDC has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Here are some companies in the Zacks Construction sector that, according to our model, have the right combination of elements to post an earnings beat in the quarter to be reported.
Louisiana-Pacific Corporation (LPX - Free Report) has an Earnings ESP of +6.43% and carries a Zacks Rank of #3.
LPX’s earnings for the to-be-reported quarter are expected to decline 18%. The company reported better-than-expected earnings in three of the last four quarters but missed on one occasion, the average surprise being 98.3%.
Martin Marietta Materials, Inc. (MLM - Free Report) has an Earnings ESP of +0.82% and carries a Zacks Rank #2.
MLM’s earnings topped the consensus mark in all the last four quarters, with the average being 37.3%. Earnings for the to-be-reported quarter are expected to rise 30.3% year over year.
Vulcan Materials Company (VMC - Free Report) has an Earnings ESP of +1.64% and carries a Zacks Rank #3.
VMC’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, with the average being 13.6%. Earnings for the to-be-reported quarter are expected to rally 25% year over year.
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MDC Gears Up to Report Q4 Earnings: Here's What to Know
M.D.C. Holdings, Inc. is scheduled to report fourth-quarter 2023 results on Jan 30, 2024, before market open.
In the last reported quarter, the company’s earnings topped the Zacks Consensus Estimate by 18.6% but declined 29.3% year over year. Total revenues missed the Zacks Consensus Estimate by 1% and fell 22.9% from the year-ago quarter’s levels.
MDC’s earnings beat the consensus mark in three of the trailing four quarters and missed the same for once, the average surprise being 53.6%.
The Trend in Estimate Revision
The Zacks Consensus Estimate for the to-be-reported quarter’s earnings per share remained unchanged at $1.44 in the past seven days. However, the estimated figure indicates a 33.3% rise from the year-ago quarter’s earnings of $1.08 per share.
M.D.C. Holdings, Inc. Price and EPS Surprise
M.D.C. Holdings, Inc. price-eps-surprise | M.D.C. Holdings, Inc. Quote
The consensus mark for revenues is pegged at $1.29 billion, suggesting a decline of 14.9% from the prior-year quarter’s reported figure.
Factors to Note
Revenues
MDC's fourth-quarter revenues are expected to have declined year over year due to the moderation in the housing demand. The downside is likely to be caused by higher mortgage rates and lower average selling prices. Also, the company has been facing challenges from the material cost and wage inflation, impacting the overall affordability of the U.S. housing market.
The company has been focusing on strategic investments in homebuilding operations to expand its local market presence. Land acquisition activity experienced a significant uptick in the third quarter and this trend was anticipated to persist in the fourth quarter.
Also, MDC's financing incentives, like rate buy-downs and closing cost assistance, effectively address buyer affordability concerns. These strategic initiatives are likely to have helped it partially offset the adverse effects of the aforementioned risks.
For fourth-quarter 2023, MDC expects home deliveries to be within 2,200-2,400 units, down from 2,554 units delivered a year ago. Our model predicts deliveries to decline 10.8% year over year to 2,277 units.
MDC expects the average selling price or ASP for the quarter to be in the range of $545,000-$555,000 compared with $582,300 reported a year ago. Our model predicts ASP to decline 5% year over year to $553,200.
Segment-wise, we expect the Homebuilding revenues to decline 15.3% to $1.26 billion from $1.49 billion reported a year ago due to lower deliveries and ASP. Also, we anticipate the Financial Services revenues to drop 0.9% year over year to $32 million.
Margins
The bottom line of MDC is likely to be affected by the ongoing inflationary pressures, higher costs and softer revenues. The company anticipates the housing gross margin (assuming no impairments or warranty adjustments) to be between 18% and 19.5% compared with 21.3% reported in the prior year.
Our model predicts homebuilding gross margin (excluding inventory impairments) to be 18% for the quarter, down from the year-ago period’s levels.
Orders & Backlog
We expect new orders of MDC to increase 998.1% year over year to 2,086 units in the quarter. Our model predicts the ASP of new orders to increase 39.6% year over year to $547,100.
We anticipate the total backlog to decline 13.1% to 2,584 units from 2,974 units reported a year ago. We expect the ASP of the total backlog to drop 1.1% year over year to $596,000.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for MDC for the quarter to be reported. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. Unfortunately, that is not the case here, as you will see below.
Earnings ESP: MDC has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: MDC currently sports a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks Poised to Beat on Earnings
Here are some companies in the Zacks Construction sector that, according to our model, have the right combination of elements to post an earnings beat in the quarter to be reported.
Louisiana-Pacific Corporation (LPX - Free Report) has an Earnings ESP of +6.43% and carries a Zacks Rank of #3.
LPX’s earnings for the to-be-reported quarter are expected to decline 18%. The company reported better-than-expected earnings in three of the last four quarters but missed on one occasion, the average surprise being 98.3%.
Martin Marietta Materials, Inc. (MLM - Free Report) has an Earnings ESP of +0.82% and carries a Zacks Rank #2.
MLM’s earnings topped the consensus mark in all the last four quarters, with the average being 37.3%. Earnings for the to-be-reported quarter are expected to rise 30.3% year over year.
Vulcan Materials Company (VMC - Free Report) has an Earnings ESP of +1.64% and carries a Zacks Rank #3.
VMC’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, with the average being 13.6%. Earnings for the to-be-reported quarter are expected to rally 25% year over year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.