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.
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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.
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