We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
D.R. Horton, Inc. (DHI - Free Report) reported third-quarter fiscal 2024 (ended Jun 30, 2024) results, with earnings and revenues surpassing Zacks Consensus Estimate. On a year-over-year basis, both the top and bottom lines increased.
Despite elevated inflation and mortgage interest rates, D.R. Horton experienced strong performance in the fiscal third quarter due to the limited supply of both new and existing homes at affordable price points and favorable housing demand demographics. The company's strategic positioning with affordable product offerings and a flexible lot supply has been crucial.
D.R. Horton anticipates generating increasing levels of consolidated operating cash flows, supported by strong liquidity and low leverage, which provide significant financial flexibility. The company continues to follow a disciplined approach to capital allocation, aiming to enhance long-term value through consistent and increasing capital returns to shareholders via share repurchases and dividends.
D.R. Horton, Inc. Price, Consensus and EPS Surprise
DHI reported adjusted earnings of $4.10 per share in the fiscal third quarter, which beat the Zacks Consensus Estimate of $3.80 by 7.9% and increased 5% from the year-ago figure of $3.90.
Total revenues (Homebuilding, Forestar, Rental and Financial Services) came in at $10 billion, up 2% year over year. The reported figure topped the consensus mark of $9.68 billion by 2.9%.
The consolidated pre-tax profit margin came in at 18.1% in the quarter under review.
Segment Details
Homebuilding revenues of $9.24 billion increased 6% from the prior-year quarter. Home sales were $9.23 billion, up 6.1% from the year-ago period. Home closings rose 5% from the prior-year quarter to 24,155 homes.
Net sales orders were up 1% year over year to 23,001 homes. The value of net orders was flat year over year at $8.7 billion. The cancelation rate (on gross sales orders) was 18%, unchanged from a year ago.
Order backlog of homes at the end of the fiscal third quarter was 16,792 homes, down 12% year over year. Moreover, the value of the backlog was down 12% from the prior-year period to $6.6 billion.
Financial Services’ revenues increased 6% from the year-ago level to $242.3 million.
Forestar contributed $318.4 million to total quarterly revenues with 3,255 lots sold, indicating a decline from $368.9 million in revenues generated a year ago on 3,812 lots sold.
The Rental business generated revenues of $413.7 million for the quarter compared with $667.1 million a year ago.
Balance Sheet Details
D.R. Horton’s cash, cash equivalents and restricted cash totaled $2.99 billion as of Jun 30, 2024, compared with $3.87 billion at the end of fiscal 2023. It had $2.8 billion of available capacity on the revolving credit facility on Jun 30, 2024. Total homebuilding liquidity was $5.8 billion.
At the end of June 2024, DHI had 42,600 homes in inventory, of which 26,200 were unsold. D.R. Horton’s homebuilding land and lot portfolio totaled 630,200 lots at the end of the fiscal third quarter. Of these, 24% were owned and 76% were controlled through land and lot purchase contracts.
At the end of third-quarter fiscal 2024, debt totaled $5.7 billion, with a debt to total capital of 18.8%. The trailing 12-month return on equity was 21.5%.
D.R. Horton repurchased 3 million shares of common stock for $441.4 million in the fiscal third quarter. As of Jun 30, 2024, the company's remaining stock repurchase authorization was $459.7 million. In July 2024, the board of directors approved a new authorization for the repurchase of up to $4.0 billion of the company's common stock, replacing the previous authorization. This new authorization has no expiration date.
Updated Fiscal 2024 Views
DHI now expects consolidated revenues in the range of $36.8-$37.2 billion versus the prior expectation of $36.7-$37.7 billion. DHI reported $35.5 billion in revenues in fiscal 2023. Homes closed are anticipated within 90,000-90,500 units versus 89,000-91,000 units expected earlier. The income tax rate is expected to be in the range of 23.5-24%.
Fiscal 2024 cash flow from homebuilding operations is still expected to be nearly $3 billion. Share repurchases are now projected at approximately $1.8 billion versus $1.6 billion expected earlier.
KB Home (KBH - Free Report) reported impressive results in the second quarter of fiscal 2024 (ended May 31, 2024). Both earnings and revenues beat the Zacks Consensus Estimate. Shares of this leading homebuilder rose 2.2% in the after-market trading session on Jun 18.
On an encouraging note, KB Home’s earnings increased on a year-over-year basis despite a revenue decline. Leveraging the advantages of its Built to Order model, which provides buyers with choices, flexibility and affordability, the company is confident in its ability to effectively navigate potential fluctuations in housing market conditions.
Lennar Corporation (LEN - Free Report) reported second-quarter fiscal 2024 results, wherein its earnings and revenues surpassed the Zacks Consensus Estimate. On a year-over-year basis, both the top and bottom lines increased, given the company’s emphasis on maintaining a steady production rate to drive sales momentum.
Lennar strategically utilized pricing, incentives, marketing expenditure and dynamic pricing insights to ensure steady sales volume despite fluctuations in interest rates.
Acuity Brands, Inc. (AYI - Free Report) reported mixed results in third-quarter fiscal 2024 (ended May 31, 2024), with earnings surpassing the Zacks Consensus Estimate and revenues missing the same. Earnings beat the consensus mark for the 17th consecutive quarter.
Despite a year-over-year decline in sales in the lighting business, AYI reported strong fiscal third-quarter performance driven by increased focus on margins and cash generation. This approach resulted in a higher adjusted operating profit margin and increased adjusted EPS.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Shutterstock
D.R. Horton (DHI) Q3 Earnings & Revenues Surpass Estimates
D.R. Horton, Inc. (DHI - Free Report) reported third-quarter fiscal 2024 (ended Jun 30, 2024) results, with earnings and revenues surpassing Zacks Consensus Estimate. On a year-over-year basis, both the top and bottom lines increased.
Despite elevated inflation and mortgage interest rates, D.R. Horton experienced strong performance in the fiscal third quarter due to the limited supply of both new and existing homes at affordable price points and favorable housing demand demographics. The company's strategic positioning with affordable product offerings and a flexible lot supply has been crucial.
D.R. Horton anticipates generating increasing levels of consolidated operating cash flows, supported by strong liquidity and low leverage, which provide significant financial flexibility. The company continues to follow a disciplined approach to capital allocation, aiming to enhance long-term value through consistent and increasing capital returns to shareholders via share repurchases and dividends.
D.R. Horton, Inc. Price, Consensus and EPS Surprise
D.R. Horton, Inc. price-consensus-eps-surprise-chart | D.R. Horton, Inc. Quote
Earnings, Revenues & Margin Discussion
DHI reported adjusted earnings of $4.10 per share in the fiscal third quarter, which beat the Zacks Consensus Estimate of $3.80 by 7.9% and increased 5% from the year-ago figure of $3.90.
Total revenues (Homebuilding, Forestar, Rental and Financial Services) came in at $10 billion, up 2% year over year. The reported figure topped the consensus mark of $9.68 billion by 2.9%.
The consolidated pre-tax profit margin came in at 18.1% in the quarter under review.
Segment Details
Homebuilding revenues of $9.24 billion increased 6% from the prior-year quarter. Home sales were $9.23 billion, up 6.1% from the year-ago period. Home closings rose 5% from the prior-year quarter to 24,155 homes.
Net sales orders were up 1% year over year to 23,001 homes. The value of net orders was flat year over year at $8.7 billion. The cancelation rate (on gross sales orders) was 18%, unchanged from a year ago.
Order backlog of homes at the end of the fiscal third quarter was 16,792 homes, down 12% year over year. Moreover, the value of the backlog was down 12% from the prior-year period to $6.6 billion.
Financial Services’ revenues increased 6% from the year-ago level to $242.3 million.
Forestar contributed $318.4 million to total quarterly revenues with 3,255 lots sold, indicating a decline from $368.9 million in revenues generated a year ago on 3,812 lots sold.
The Rental business generated revenues of $413.7 million for the quarter compared with $667.1 million a year ago.
Balance Sheet Details
D.R. Horton’s cash, cash equivalents and restricted cash totaled $2.99 billion as of Jun 30, 2024, compared with $3.87 billion at the end of fiscal 2023. It had $2.8 billion of available capacity on the revolving credit facility on Jun 30, 2024. Total homebuilding liquidity was $5.8 billion.
At the end of June 2024, DHI had 42,600 homes in inventory, of which 26,200 were unsold. D.R. Horton’s homebuilding land and lot portfolio totaled 630,200 lots at the end of the fiscal third quarter. Of these, 24% were owned and 76% were controlled through land and lot purchase contracts.
At the end of third-quarter fiscal 2024, debt totaled $5.7 billion, with a debt to total capital of 18.8%. The trailing 12-month return on equity was 21.5%.
D.R. Horton repurchased 3 million shares of common stock for $441.4 million in the fiscal third quarter. As of Jun 30, 2024, the company's remaining stock repurchase authorization was $459.7 million. In July 2024, the board of directors approved a new authorization for the repurchase of up to $4.0 billion of the company's common stock, replacing the previous authorization. This new authorization has no expiration date.
Updated Fiscal 2024 Views
DHI now expects consolidated revenues in the range of $36.8-$37.2 billion versus the prior expectation of $36.7-$37.7 billion. DHI reported $35.5 billion in revenues in fiscal 2023. Homes closed are anticipated within 90,000-90,500 units versus 89,000-91,000 units expected earlier. The income tax rate is expected to be in the range of 23.5-24%.
Fiscal 2024 cash flow from homebuilding operations is still expected to be nearly $3 billion. Share repurchases are now projected at approximately $1.8 billion versus $1.6 billion expected earlier.
Zacks Rank
Currently, D.R. Horton carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Releases From the Construction Sector
KB Home (KBH - Free Report) reported impressive results in the second quarter of fiscal 2024 (ended May 31, 2024). Both earnings and revenues beat the Zacks Consensus Estimate. Shares of this leading homebuilder rose 2.2% in the after-market trading session on Jun 18.
On an encouraging note, KB Home’s earnings increased on a year-over-year basis despite a revenue decline. Leveraging the advantages of its Built to Order model, which provides buyers with choices, flexibility and affordability, the company is confident in its ability to effectively navigate potential fluctuations in housing market conditions.
Lennar Corporation (LEN - Free Report) reported second-quarter fiscal 2024 results, wherein its earnings and revenues surpassed the Zacks Consensus Estimate. On a year-over-year basis, both the top and bottom lines increased, given the company’s emphasis on maintaining a steady production rate to drive sales momentum.
Lennar strategically utilized pricing, incentives, marketing expenditure and dynamic pricing insights to ensure steady sales volume despite fluctuations in interest rates.
Acuity Brands, Inc. (AYI - Free Report) reported mixed results in third-quarter fiscal 2024 (ended May 31, 2024), with earnings surpassing the Zacks Consensus Estimate and revenues missing the same. Earnings beat the consensus mark for the 17th consecutive quarter.
Despite a year-over-year decline in sales in the lighting business, AYI reported strong fiscal third-quarter performance driven by increased focus on margins and cash generation. This approach resulted in a higher adjusted operating profit margin and increased adjusted EPS.