“This is the pain that comes with bringing inflation down,” Julia Coronado, founder and president of Macro Policy Perspectives, told Marketplace listeners on September 21.
Two recent data points are shaking homebuilder stocks. The 10-year Treasury note briefly hit 5%, and the rate on a 30-year fixed mortgage climbed back to 7%.
The latest trading day saw D.R. Horton (DHI) settling at $135.57, representing a -2.42% change from its previous close.
In the most recent trading session, D.R. Horton (DHI) closed at $144.41, indicating a +1.51% shift from the previous trading day.
Long-term Treasury yields are rebounding despite the government's expanded bond-buyback plan, putting renewed pressure on rate-sensitive stocks. The 30-year recently reached its highest yield since 2007, prompting the U.S. Treasury Department to announce expanded long-duration buybacks to relieve pressure on the long end of the bond market.
D.R. Horton (DHI) reported earnings 30 days ago. What's next for the stock?
US Treasury yields pushed into territory unseen since before the financial crisis on Tuesday, putting a spotlight on stocks exposed to housing and expensive long-duration growth. The 30-year Treasury yield climbed to 5.327%, its highest since 2007, while the 10-year reached 4.739%.
When Treasury prices drop, yields move higher. When that happens, mortgage rates go up, and so does the cost of buying a home.
Smaller builders are trading near or below book value, and all have relatively small market capitalizations.
D.R. Horton is upgraded from sell to hold as execution offsets weak demand and valuation concerns. Orders per community are declining, cancellations are rising, and management has lowered FY2026 guidance, highlighting ongoing demand softness. DHI's inventory management, reduced construction costs, and controlled-lot strategy are mitigating margin and balance sheet risks.
Capital markets recently welcomed a severe threat to traditional homebuilding. Boxabl Inc. NASDAQ: BXBL officially listed on the public markets via a special-purpose acquisition company.
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