D.R. Horton Exceeds All Expectations
MarketBeat.com | Nov 10, 2021 12:48AM ET
D.R. Horton Beats And Sets Guidance For 2022
D.R. Horton (NYSE:DHI) exceeded all expectations and that is saying something. We’ve had high expectations for the company and the industry for some time. The housing industry is in a golden age only marred by a shortage of workers and rising costs for materials. The demand for homes continues to exceed the industry’s capacity to deliver and that is clearly evident in the results.
Results continue to impress but there's more; results are outpacing the consensus targets and the company is guiding the market even higher which is something we like to see. Add to that a very safe and growing dividend, and an active share repurchase program, and we see a recipe for higher share prices that could drive the stock up to a new all-time-high very soon.
D.R. Horton Has Record Quarter
D.R. Horton posted $8.1 billion in fiscal 4th quarter revenue to set a company record. The revenue is 26.6% above last year’s Q4, 60% above 2019 and beat the Marketbeat.com consensus by 420 basis points. The gain is driven by an 8% increase in closings compounded by higher selling prices that are expected to persist. Margins were positively impacted by the combination of demand strength and pricing widening 480 basis points to 21.3% This helped drive very solid gains on the bottom line with GAAP EPS of $3.70 growing 65% YOY and beating consensus by $0.31.
The only bad news is that orders are slowing and the backlog is coming down. New orders fell 33% on homes-basis and 17% on a valuation basis aiding the 2% decline in the backlog. Even so, the company says consensus estimate of $105 and the Wall Street high price target of $125 set by Wedbush over the summer.
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