Housing
D.R. Horton Earnings Could Get Even Better as Mortgage Rates Decline
Published:
Last Updated:
Home sales closed rose from 6,188 in the first quarter of 2014 to 7,973. Horton’s sales order backlog grew from 7,684 a year ago to 9,285 with a total value of $2.7 billion.
Horton’s cancellation rate (cancelled sales orders divided by gross sales orders) for the first quarter of fiscal 2015 was 24%, down sequentially from 28%.
Revenue from home sales for the quarter rose by 38%, while the cost of sales rose about 42%.
The company’s chairman said:
Our position as the largest and most geographically diverse homebuilder provides a strong platform for us to compete for new home sales… Our weekly sales pace has accelerated in January, and we are well-positioned to capture demand in the spring selling season with our solid balance sheet and robust community count, finished lot supply and inventory of homes available for sale.
Other than that statement, Horton did not offer guidance. The consensus estimates for the second quarter of the company’s 2015 fiscal year call for EPS of $0.38 on revenues of $2.17 billion. For the full year, analysts expect EPS of $1.81 on revenues of $9.97 billion.
ALSO READ: Home Price Index Gains More Than Expected
Horton’s results are better than those reported by competitors Lennar Corp. (NYSE: LEN) and KB Home (NYSE: KBH) earlier this earnings season. The company’s more moderately priced homes are available to more buyers. Even better for Horton are recent declines in mortgage interest rates and an easing of FHA insurance requirements for low down payment buyers.
Shares traded up about 7% in premarket trading Monday to $24.70, in a 52-week range of $19.29 to $26.82. Thomson Reuters had a consensus analyst price target of around $25.80 before the results were announced.
100 Million Americans Are Missing This Crucial Retirement Tool
The thought of burdening your family with a financial disaster is most Americans’ nightmare. However, recent studies show that over 100 million Americans still don’t have proper life insurance in the event they pass away.
Life insurance can bring peace of mind – ensuring your loved ones are safeguarded against unforeseen expenses and debts. With premiums often lower than expected and a variety of plans tailored to different life stages and health conditions, securing a policy is more accessible than ever.
A quick, no-obligation quote can provide valuable insight into what’s available and what might best suit your family’s needs. Life insurance is a simple step you can take today to help secure peace of mind for your loved ones tomorrow.
Click here to learn how to get a quote in just a few minutes.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.