Why Home Builder D.R. Horton’s Stock Has Soared This Year

by Trefis Team
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D.R. Horton (NYSE: DHI), the largest home building company in the U.S., in terms of the number of homes closed, has seen its stock post a steady increase this year, rising by over 20% over the last 3 months and by close to 50% since January. There have been multiple factors driving this growth. Firstly, mortgage rates in the U.S. have been on the decline, falling from levels of as much as 5% last year (30-year mortgage) to levels of under 3.7% currently. This is helping to lower costs and improve housing demand. D.R. Horton has been doing better than its peers in terms of new orders, driven by an increasing focus on affordable homes, while the company has also been expanding its revenues and footprint via acquisitions. For instance, in FY’18 (FY ends September), the company acquired Forestar a residential lot development, in a move that helped it improve its land acquisition capabilities. Below, we take a look at how the company fared over the last few quarters and what lies ahead.

View our interactive dashboard analysis on Why Home Builder D.R. Horton Is Up 50% This Year

How does D.R. Horton’s Revenue Growth In 2018 compare with that in prior periods and what’s the forecast?

 

Total Revenues for D R Horton increased from $14.1 Bil in 2017 to $16.1 Bil in 2018; an increase of 14.0%.

 

This compares with Total Revenues growth of:

  • 34.9% in 2015 compared to 2014
  • 12.3% in 2016 compared to 2015
  • 15.9% in 2017 compared to 2016

We expect Total Revenues growth to be 9% in 2019.

How does D.R. Horton’s Total Expense In 2018 compare with that in prior periods and what’s the forecast?

Total Expense for D R Horton increased from $12.5 Bil in 2017 to $14.0 Bil in 2018; an increase of 12.2%.

This compares with Total Expense growth of:

  • 34.5% in 2015 compared to 2014
  • 11.4% in 2016 compared to 2015
  • 15.6% in 2017 compared to 2016

We expect Total Expense growth to be 10.5% in 2019.

How does D.R. Horton’s EBT In 2018 compare with that in prior periods and what’s the forecast?

EBT for Horton D R increased significantly by 28.6% from $1.60 Bil in 2017 to $2.06 Bil in 2018.

We expect EBT to decline modestly to $2 Bil in 2019.

How do D.R. Horton’s Net Income and EPS In 2018 compare with that in prior periods and what’s the forecast?

For more information on D.R. Horton’s Net Income and EPS, view our interactive dashboard analysis.

 

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