Here's Why D.R. Horton Is Looking Attractive
Homebuilder stocks are trading at low multiples despite consensus estimates predicting 22%-82% earnings growth by 2028, indicating potential undervaluation. The U.S. housing market faces an affordability crisis, but long-term undersupply and strong fundamentals make homebuilders attractive investments. Homebuilders have improved margins, low debt, and strong free cash flow, positioning them well for future growth and share buybacks.
A mostly challenging outlook for home builders caused analysts to reshuffle ratings on most of the big names in the sector on Monday.
U.S. homebuilding giant D.R. Horton (DHI -0.93%) reported fiscal 2025 first-quarter earnings on Tuesday, Jan. 21, which topped analysts' consensus estimates.
U.S. stocks traded higher midway through trading, with the Dow Jones index gaining over 450 points on Tuesday.
DHI's fiscal first-quarter results reflect a focus on affordable housing, operational flexibility, and disciplined capital allocation amid challenging market conditions.
D.R. Horton, Inc. (NYSE:DHI ) Q1 2025 Earnings Conference Call January 21, 2025 8:30 AM ET Company Participants Jessica Hansen - SVP, IR and Communications Paul Romanowski - President and CEO Michael Murray - EVP and COO Bill Wheat - EVP and CFO Conference Call Participants John Lovallo - UBS Alan Ratner - Zelman & Associates Stephen Kim - Evercore ISI Carl Reichardt - BTIG Michael Rehaut - JPMorgan Matthew Bouley - Barclays Sam Reid - Wells Fargo Eric Bosshard - Cleveland Research Anthony Pettinari - Citi Mike Dahl - RBC Capital Markets Ken Zener - Seaport Research Partners Rafe Jadrosich - Bank of America Trevor Allinson - Wolfe Research Buck Horne - Raymond James Susan Maklari - Goldman Sachs Alex Barron - Housing Research Center Jade Rahmani - KBW Operator Good morning and welcome to the First Quarter 2025 Earnings Conference Call for D.R. Horton, America's builder, the largest builder in the United States.
While the top- and bottom-line numbers for D.R. Horton (DHI) give a sense of how the business performed in the quarter ended December 2024, it could be worth looking at how some of its key metrics compare to Wall Street estimates and year-ago values.
Shares of D.R. Horton (DHI) advanced Tuesday when the country's biggest homebuilder posted better-than-expected results as incentives boosted purchase activity.
D.R. Horton (DHI) came out with quarterly earnings of $2.61 per share, beating the Zacks Consensus Estimate of $2.40 per share. This compares to earnings of $2.82 per share a year ago.
D.R. Horton's stock surges toward a sixth straight gain after earnings falls but beat expectations.
DHI's first-quarter fiscal 2025 results are expected to decline due to lower homes closed and increased expenses. Let's delve in to get a better picture of the stock ahead of earnings.